Business Rate recommendations don’t go far enough says Bruton Knowles

Stephen James of Bruton Knowles’ Cardiff office. Picture by Antony Thompson - Thousand Word Media

Recommendations by a National Assembly Committee into business rates do not go far enough to support struggling high street retailers and businesses across Wales.

In a recent report, the Economy, Infrastructure and Skills Committee came up with five recommendations for business rate reform across the Principality.

However, according to property experts at Bruton Knowles, further stimulus is needed in order to retain and improve occupancy otherwise changing shopping habits and the growing burden of taxes will result in further closures on Wales’ high streets.

Stephen James, who is part of the firm’s valuation consultancy team, is now calling for an immediate reduction in business rates to help retailers compete against online traders and prime retail centres in Cardiff, Swansea and Newport.

Stephen said: “The recommendation to simplify the current business rate system should be broadly welcomed, however a lot of retailers who are located in some of Wales’s secondary and tertiary towns need a lifeline now to ensure they survive tough trading conditions.

“Investment focus has been on the major cities and prime retail centres of South Wales – Cardiff, Newport and Swansea.

“But towns such as Bridgend, Port Talbot and those in the South Wales valleys have suffered a lack of investment. They don’t have new town centre shopping precincts like Friar’s Walk in Newport to encourage growth, and need further help if they are to have any hope of slowing, let alone reversing the decline.

“Cardiff continues to go from strength to strength and Friar’s Walk has experienced good occupancy levels while major investment and regeneration is planned for Swansea city centre in conjunction with the local council.”

Stephen believes the devolution of business rates to the Welsh Assembly Government has given it the perfect opportunity to help high streets up and down the country by dropping rates where they are needed most.

He added: “Cutting business rates will encourage speculative commercial property development and help the sector grow.  Lack of speculative development on regeneration projects continues to hold the market back.

“Another suggestion is for property rating valuations to be undertaken every two to three years rather than every five years at present to reflect the fast-changing market.

“Unrealistic expectations by landlords and their property advisors at rent review and lease renewal dates has also contributed to the problem. I’m sure landlords would prefer some rental income than none at all and attitudes need to change in line with market forces to reflect what is a reasonable rate.”

Based at Bruton Knowles’ Cardiff office, Stephen specialises in providing commercial valuation advice for major lending institutions, owners and investors.