The British Property Federation (BPF) has urged the Government to extend the period of business rates relief for empty properties, following a new analysis into shop vacancies.
Currently owners of vacant shops have a three-month exception from business rates to allow time to upgrade stores as necessary and re-let them to a new tenant
The BPF has called for this to be increased to 12 months and to reintroduce a 50% rate cut for long-term empty shops.
This comes after a recent study carried out by The Local Data Company which found that more time is needed to find a new tenant and re-let empty shops.
The research analysed over 1,000 retail locations including high street, shopping centres and retail parks comprising of more than 124,000 individual shops and revealed that one in ten of empty units have been re-let within six months. Additionally the data indicated that almost a third of empty shops took more than two years to be reoccupied.
The data showed a regional disparity across the UK, with just 4% of empty stores in Yorkshire re-let in sex months, along with 5% in the East Midlands and North East, compared to 13% in the South West and Greater London.
According to the study it highlighted that re-letting empty stores is challenging across all location types, with 9.9% of high streets stores reoccupied in six months, compared to 7.5% at shopping centres and 10.3% at retail parks.
A HM Treasury consultation on Empty Rates Avoidance and Evasion closed last week and the study on retail property vacancy was included as part of BPF’s response.
The BPF pointed out that the current system of empty rates is fundamentally unfair to property owners who can face a high rates liability on premises without any rental income.
Melanie Leech, chief executive of the British Property Federation 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. 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.”
The Association of Convenience Stores also recently called for action on empty sites, saying ”there was a need for deeper examination to understand the core reasons as to why these properties are vacant in the first place”.
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