Extend empty rates relief to a year, says BPF
The British Property Federation (BPF) has called on the Government to extend empty rates relief from three months to 12.
Currently, owners of vacant shops are given a three-month exemption from business rates to allow time for upgrades and re-letting.
However, the BPF argues that the current rates relief is “not sufficient” for property owners to re-let their space.
The federation has also called for a reintroduction of a 50% rate cut for long-term empty stores.
This comes following an analysis into shop vacancy from Local Data Company (LDC), which looked at over 1,000 retail locations including high streets, shopping centres, and retail parks comprising over 124,000 individual shops.
The analysis found that just 9% of vacant shops were reoccupied within six months, whilst almost a third (31%) of vacant units took over two years to become reoccupied.
LDC’s data also showed a regional disparity across the UK, with only 4% of vacant stores in Yorkshire re-let within six months, along with 5% in the East Midlands and North East, compared to 13% in the South West and Greater London.
The analysis also found that re-letting empty stores is a challenge across all location types, with 9.9% of high street stores reoccupied in six months, in comparison to 7.5% at shopping centres and 10.3% at retail parks.
The data is part of the BPF’s response to the HM Treasury consultation on Empty Rates Avoidance and Evasion, which will close on 28 September. The BPF argues that the current system of empty rates is “fundamentally unfair” to property owners.
Melanie Leech, chief executive, BPF, said: “Government should be doing everything it can to support the property owners whose investment will be critical to revitalising our high streets and town centres.
“Our analysis shows that less than one in ten empty shops is re-occupied within six months and almost a third lie empty for more than two years, making the current 3-month empty rates relief completely out of step with today’s market conditions.
“We recognise that business rates generate vital income for local authorities, but it is simply not sustainable for property owners to shoulder this tax burden when there is no tenant or income on a unit. This is effectively kicking someone while they are down, and only adds to the challenge of upgrading and repurposing older stores and attracting new businesses.
“If the Government is serious about supporting high streets and town centres it must extend the period of business rates relief for empty shops and other commercial units in line with the evidence, and reintroduce a 50% reduction thereafter.”