Empty rate toll will escalate closures

A leading property agent has hit out at changes to cut rate relief on empty properties, claiming it will have the "opposite effect" to what the government intends.

From tomorrow (April 1) pub owners will no longer be granted rate relief if the building is empty for longer than three months. Previously rates for owners of empty properties were waived.

The measures were confirmed in the Budget earlier this month and the government claims it will help increase the supply of commercial property, cut costs for firms and encourage them to use land efficiently.

But Barry Gillham, chairman of Fleurets, said the changes will have the opposite effect for the pub industry.

"Today nobody deliberately keeps property empty, they are generally trying to let it, but it's a really depressed market," he said.

"It means no developers will develop new property on spec for fear of having their costs rise.

"It will escalate the closing down of village pubs that people are trying to sell."

Gillham also warned that landlords would be tempted to take the roof off to reduce rates.

However Neil Morgan, head of public houses at agent Christie + Co, said the changes will have some positive effects. "Hopefully it will give some individual operators the chance to come back into the market and buy themselves a relatively cheap freehold."

The number of private operators has now dropped in the UK to around 17,300.

He also suggested it would force pubcos to make a quicker decision on shut pubs. "The problem is that boarded-up pubs are a blot on the landscape and they do not help the image of the Great British pub," Morgan said. "It will hasten things up so these are either opened up or put out for disposal."