Pooks Commercial Property Consultants of Shrewsbury have been examining the implications of the Chancellor's Pre-Budget Report upon commercial developments and investment. Introduced somewhat controversially this year was an abolition of the allowances given to owners and tenants of empty shops, offices and factories concerning the payment of business rates. Since the implementation of full costs in April, some empty larger office and factory complexes have been demolished to avoid paying these extra taxes and, equally as importantly, this has inhibited new development or refurbishment at a time when activity is already at a low ebb.

Pooks' consideration of the proposal suggests that the Chancellor has only granted relief to properties up to a rateable value of £15,000 and then only for a temporary period of 12 months from April 2009. This means that all but the smallest buildings are still affected and it does not give any immediate relief to existing empty properties.

Charles Howell of Pooks said "this policy affects not only existing owners who face crippling charges at a time of reduced income, but also tenants who are trying to sell on leases or sub-let empty property. More importantly, it has also contributed to the almost complete cessation of speculative commercial property development in Shropshire and Mid Wales, which will lead to a shortage of business space in the future". Local Authorities and other public sector corporations building advance factories are also affected, with the situation in Shropshire replicated across the UK. According to the property business press there are moves by Welsh Assembly Government to promote empty property business rates relief within Wales, which could have serious implications for the local commercial property market in the Border Counties Area.

Pooks suggest that commercial property owners and occupiers lobby trade organisations and local MPs to try to alleviate this additional tax burden as part of the formal budget proposals in the Spring.

Credit to:
Charles Howell, Partner at Pooks Commercial Property Consultants on 01743 276633.
26 Claremont Hill
Shrewsbury
SY1 1RE
Email: cth@pooks.co.uk