9 March 2009 Rating Evaluation

9 March 2009

Clubs brace for 2010 rating revaluation

UPFRONT, news, night online, COMMENTS

With property occupancy costs rising against a background of market uncertainty, business rates specialist Gerald Eve is advising ratepayers in the nightclubs sector to start planning now for the 2010 rating revaluation.

It may be over a year away but the Valuation Office Agency and Scottish Assessors are already preparing their valuations of all properties for the 2010 revaluation. These will be based on an analysis of rental values and economic circumstances as at 1 April 2008.

Julian Jennings, leisure partner at Gerald Eve, comments: “The late 1990s expansion drive of the major nightclub operators is now long over. The market has suffered a difficult five years since the April 2003 valuation date for the 2005 rating assessments. Licensing reforms and the smoking ban have accompanied a crusade against a perceived drink-related disorder problem, and there are growing pressures on younger consumers’ spending power and on operators’ energy and staffing costs. The latter has been particularly affected by new regulations for the licensing of door staff and increases in the minimum wage.

“The industry is now in a period of consolidation, with a number of operators already having gone to the wall. It should therefore benefit from the 2010 revaluation as it will be difficult to establish a pattern of positive rental growth, while at the lower end of the market, there should be reductions in some assessments.”

Julian adds: “2010 might be some way down the worry list of many in the nightclubs sector as far as their rates bills are concerned. However, early recognition of the issues affecting the next rating revaluation will help businesses to plan ahead, both in terms of the action they can take to minimise their rates bills and in the provision of more accurate budget forecasts.”

From: Night Online

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