Wednesday's (December 5th) Autumn Statement brought good news for the commercial property market in the UK and there is hope that the changes will lead to further growth. Jones Lang LaSalle claims that the decision to exempt all newly built commercial property completed between October 1st 2013 and September 30th 2016 from empty property rates for the first 18 months will help to promote private investment. The exemption will apply up to the state aid limits and is currently subject to consultation.
Tim Beattie, lead director, rating at Jones Lang LaSalle, stated: "Subject to the detail of the consultation process and the state aid limits, [we] could clearly see some speculative schemes being started sooner rather than later but there will also be a tension between these provisions and the localism agenda enshrined in the Local Government Finance Act 2012. Billing Authorities are expected to take a keen interest in new development in their area after April 1st 2013 because they will benefit from the increased tax take."
Nevertheless, the measure has been welcomed and property investment in the UK is expected to be revitalised over the coming years. The move to extend the temporary doubling of the Small Business Rate Relief scheme is also hoped to stimulate improved market activity. The scheme will now run for an additional 12 months from April 1st 2013.
Further positive news was provided in the announcement that the government will extend the temporary doubling of the Small Business Rate Relief scheme for a further 12 months from April 1st 2013. However, this follows calls from "hard pressed retailers and local businesses" to reverse the decision to postpone the 2015 Revaluation to 2017, Mr Beattie explained. This means that the benefits that a Revaluation brings to these businesses are delayed, in what has been deemed an "ill thought out decision".
"The next revaluation would re-distribute the rates burden in line with current economic activity thus easing the pressure on high streets in particular," Mr Beattie claimed, which would in turn provide an economic boost.