Here - Property Managers Association

September 2015
The work of the PMA
The President’s Update
Membership Update 2015
Service Charge Update
Committee Members 2015
Annual Conference Review 2015
Member Spotlight
Legal Update 2015
The PMA at 40
Xmas 2015
Rating Commentary
Retailers Working Together 2015
2
September 2015
The PMA was established in 1975
to provide a forum for coordinated
action on retailer’s occupancy
interests. The membership now
extends to over 100 of the UK’s
retailers ranging from national
multistore retailers to smaller chains.
The Executive Committee consists
of elected members supported by
several specialist groups and subcommittees. The PMA remains an
important voice for retailers’ property
departments to work alongside
other related organisations as we
The President’s Update
www.propertymanagersassociation.com
Simon Williets
Starbucks Coffee
Co UK Ltd.
I offer you all a very warm welcome to
our annual newsletter. 2015 has been an
important year for the country as a whole
after the verdict of the electorate in May.
Whilst the result was not what the polls
were predicting beforehand, we can now
anticipate what the next 5 years will bring
as a Conservative government will, in
their own words, seek to “finish the job”
of completing the economic recovery.
There have been clear signs over the last
couple of years that the UK economy
had recovered some strength as a
result of new job creation and returning
consumer confidence, and this leads
me to believe that the future is generally
looking positive for the retail sector. We
are clearly not seeing the volume of new
retail development of previous years,
but some smaller schemes and infills are
creating a pipeline as developers regain
confidence in the market.
There is therefore a much greater
emphasis on renewal and reconfiguration
of our existing retail stock, with a big
attention to detail and quality. Internet
shopping has led to some retailers
having to reassess their ongoing size
requirements, thereby potentially
releasing unwanted floorspace and
giving other retailers good expansion
opportunities. At the same time, the
click and collect routine actually gets
customers returning into stores and, in
the majority of cases, buying additional
unplanned items at the same time.
This gradual shift will ultimately require
retailers’ property teams to look at their
stores, try to dispose of those that no
longer fit their business model, and
either consolidate, or acquire new ones
that do.
Retail property occupancy costs are
high on the agenda, and the need for
flexibility in lease liability is of paramount
importance. It remains our collective
responsibility to do whatever we can to
provide property portfolios that meet
business space requirements, whilst
keeping occupancy costs under control
as much as possible. The relationships
that we all have with our key landlords,
specialist property agents, and fellow
retailers remain vital and, more than ever,
tackle occupancy issues affecting
retail estates. Landlord and tenant
coordination is one key area of
focus, maintaining high standards of
estate management, and ensuring
occupancy costs are kept at an
affordable level. Through a program
of seminars, an annual Conference,
and other events, the PMA provides
the opportunity for retailers’ property
teams to learn from each other and
thereby improve best practice across
our sector.
we need our members to be engaged
and involved in helping to tackle our
common challenges in retail property.
the concept of a much larger “Retailer
Rendezvous”.
Our Conference in Manchester in
May [coverage pg. 8] reflected the
general economic climate & prospects
as perceived by our various speakers
following the election just a week earlier.
A record number of members attended
the Conference and were keenly
interested in the varied presentations and
subsequent question & answer sessions.
I mentioned in last year’s newsletter
my aim to enhance the reputation and
influence of the PMA with other industry
bodies such as the British Council
of Shopping Centres. I am therefore
delighted to report that PMA members
are represented on a number of BCSC
Committees, including in particular, the
organizing Committee for the BCSC
Conference in Manchester on 16th &
17th September. Both the BCSC and the
PMA wish to give more prominence to
retailers attending the Conference and,
rather than having a PMA stand as in
previous years, we have jointly developed
This will be located on the main
show floor and will be an informal
networking and meeting space. It will
also be designed to allow retailers to
present a summary of their business
models, new concepts, expansion
plans, and location requirements.
This is a real opportunity for both
property professionals and operators
to speak directly to influential players
in retail real estate. I would therefore
encourage members to attend the
Conference and to visit the Retailer
Rendezvous to hold meetings and
hear or give presentations.
PMA Events
As always, we welcome your feedback
on the work of the PMA and how we
can work together to confront the key
occupancy issues. On behalf of the
PMA Committee, we look forward to
much fruitful liaison and hope that
there is further evidence of recovery
during the remainder of the year.
www.propertymanagersassociation.com
3
4
September 2015
Out of Town Committee
More meetings were held with M&G
and British Land, with one being
organised with JLL as I write this
update.
In the light of the current perception
that we have entered into the recovery
stage it is just as important we
continue to lobby on service charge
costs. Current services charge budgets
are seeing more proposals to refurbish
parks, resurface whole car parks and
introduce more layers of staff without
engaging with the retailers as to what
is really required.
If you are interested in joining the
group and wish to find out more,
please feel free to contact me on
Email: [email protected]
PMA Membership
Update 2015
www.propertymanagersassociation.com
We currently have approximately 100
companies listed as PMA Members with
a total membership of just under 400.
We are pleased to advise that we have
some new members joining this year,
such as Day Lewis, Casual Dining Group,
Costcutter and The Theo Paphitis Retail
Group amongst others.
We have also retained many of our
Charity members.
There are many more retailers coming to
the market who could potentially benefit
from PMA membership; please do put
us in touch if you know of anyone who
would like to join. Please email Hayley
Essen for further information – email:
[email protected].
HOW TO JOIN
Retailers only are eligible
for PMA Membership
Cost:
First (Full) Company Member
£250 plus VAT pp
Associate Members
£50 plus VAT pp
Membership
offer for BCSC
Join in 2015 and you pay
just £125.00 plus VAT and
£50 plus VAT for each
additional member!
To apply for membership
please email:
[email protected]
5
September 2015
MEMBERSHIP BENEFITS
•
Free attendance at Annual Conference
•
Free Business Seminars
•
Up to 10 hours CPD at all Events throughout the year
•
Free entrance to British Council of Shopping
•
Access to members database via our website and
members activities and events
•
Opportunity to promote job adverts/ own CV free of
charge via the website
•
Access to any current Research Projects within the
Sector via links from website
•
Copy of Annual Membership Handbook
•
Opportunity to be part of the Sub-Committee forums
•
Plenty of Networking Opportunities amongst
Landlords, Retailers and Agents
www.propertymanagersassociation.com
Centres Conference
6
September 2015
Service Charge Update
Another year flies by and we have still
not had a quarterly brief reference
Service Charges – partly due to my
being extremely busy with the day job,
and partly down to the only attendees
at any of the Service Charge meetings
up and down the country seeming to
be Consultants and /or representatives,
so a general atmosphere of apathy has
not helped push me along on this.
This concerns me as we are entering
a very challenging time for Service
Charge cost control where the effects
of the break being overly applied to the
Repairs & Maintenance costs during
the 2008/09 10 Point Plan period is now
coming back to bite us in the form of
a considerable number of neglected
centres that are requiring a lot of
money spent on them – showing large
double digit increases and increases
(on average) not showing signs of
slowing down at all!
www.propertymanagersassociation.com
Centre MK Milton Keynes showed
a 34% increase for the year to March
2016 due to some sprinkler works,
that may or may not be recoverable in
their entirety, and the PPM at the same
centre is looking to move from £850k
per annum to £1.25m per annum on top
of the 34% increase mentioned above.
This is just one case, and one to be
fair where we have had a few retailers
turn up to the meetings and embarrass
CBRE who are being extremely difficult
to communicate with, but there are
many more around the country where
this has not happened and the agents
seem to be taking it as a nod that
they are not going to be challenged.
Many are adopting the old heavy
hand techniques of old with little
communication and a shrug of the
shoulders when challenged.
Whilst the Consultants and
representatives that many of you out
source Service Charge management to
can and do exert some influence,
and get concessions and wins for
you, NOTHING lets the Agents and
the Landlords know as fully what you
think about what is going off than you
turning up and saying so directly in a
group, with one voice.
One latest massive increase in the
Service Charges you pay – and your
direct labour costs too – will be Living
Wage, JLL at Palace Gardens Enfield
have imposed a 10% pay increase on
Security Cleaning and Management
office staff to address the differential
between minimum and living wage. A
defence that “it was mentioned in the
budget” was put forward and as yet no
response to my retort that the budget
stated that it should be phased in from
April 2016 and increased up to 2020,
not imposed in June 2015!!
It is only going to get worse guys –
those of us that do show up week in
week out will continue to fight but
some support at the bigger meetings
would be appreciated.
If you wish to be kept informed of the
upcoming meetings with Landlords /
Agents, or merely copied in with notes
on the fights that are ongoing please
help me to update my contact list for
those within your companies who deal
with the service charges and provide
name, tel no, and email address.
It isn’t so much of a burden it will affect
the day job, but you do need to know
what is going on, so please keep
me informed.
John Gray,
[email protected]
Service Charge Representative
PMA Committee Members September 2015
President
Committee Members
Simon Williets
David Broadbent
James Scholter
Senior Asset Manager
Starbucks Coffee Co UK Ltd
Building 4, Chiswick Park
566 Chiswick High Road
London
W4 5YE
Estates Manager
Boots UK
D90 East S11
Nottingham
NG90 1BS
Senior Estates/Aquisitions Surveyor
Domino’s Pizza
West Ashland
Milton Keynes
MK6 4BB
E: [email protected]
T: 0115 950 6111
D: 0115 949 4694
M: 07725 427251
E: [email protected]
Financial Management
Edward Budden
Richard White
Vice President Real Estate
Footlocker Europe B.V.
Ir. D.S. Tuijnmanweg 3-5
4131 PN Vianen
The Netherlands
D: +31 (0) 347 80 5150
E: [email protected]
Service Charge
Representative
John Gray
Service Charge Consultant
John Gray Service Charges Ltd
27 Rectory Gardens
Todwick
Sheffield
S26 1JU
D: 01909 770416
M: 07730 527861
E: [email protected]
Estates Manager
Coral Racing Ltd
One Stratford Place
Montfitchet Road
London
E20 1EJ
D: 020 3288 7163
M: 07841 566867
E: [email protected]
Hayley Essen
Estates Surveyor
Brantano (UK) Limited
Interlink Way West
Interlink Business Park
Bardon
Coalville
Leicestershire
LE67 1LD
D: +44 (0)1530 513554
E: [email protected]
James Hamilton
Head of UK Acquisitions & Estates
Costa Coffee – Property
Whitbread Court
Houghton Hall Business Park
Porz Avenue
Dunstable
LU5 5XE
M: 07557 114431
E: [email protected]
Nick Kidd
Head of Estates
House of Fraser
27 Baker Street
London
W1U 8AH
M: 07748 920829
D: 0207 003 4703
E: [email protected]
Jonathan Stockham
Head of Estates
Specsavers Property Services
Forum 6
Solent Business Park
Whiteley
Fareham
PO15 7PA
D: 01489 862 533
M: 07881 724880
E: [email protected]
Ben Wall
National Portfolio Manager
Poundland Ltd
Wellmans Road
Willenhall
West Midlands
WV13 2QT
D: 0121 526 8742
M: 07766 490472
E: [email protected]
Rob Wood
Head of Property
HMV Group plc
4th Floor, Mermaid House
2 Puddle Dock
Blackfriars
London
EC4V 3DB
D: 0207 432 3034
M: 07770 637580
E: [email protected]
www.propertymanagersassociation.com
D: 020 8834 5325
M: 07957 773051
E: [email protected]
8
September 2015
PMA Conference Review
2015
www.propertymanagersassociation.com
This year’s annual PMA conference was held
at the historic and iconic Manchester Town
Hall which gave a warm welcome to 185
of the membership during the day. This
year the event was kindly sponsored by
Lambert Smith Hampton following the
recent acquisition of PMA stalwarts
Tushingham Moore.
PMA President Simon Williets opened
the conference, duly titled ‘The Road
Ahead: Left, Right or Straight on’ which
reflected on a number of issues including
the unexpected election result giving the
country the first Conservative government
for 20 years. Simon summarised some of the
key achievements over the past 12 months,
the highlight of which saw another record
attendance at the PMA Christmas luncheon,
helping to raise in excess of £10,000 for
our chosen charity partner for 2014,
Prostate Cancer.
Looking forward, the PMA is approaching
the big 40, so we will be hosting a ‘40th
Birthday Party on the 6th October 2015 in
Leicester Square and all PMA members are
cordially invited to attend (see pages 17/18).
Guest Speakers - Morning
Blake Penfold of Blake Penfold
Consulting kicked of the day’s
presentation with ‘A Review of Rating
and Challenges Post Election’. Blake
summarised the key challenges of the
current system which sees a high tax rate
by comparison with other countries and
with ever increasing complexity around
Supplements, Reliefs/Exemptions and
liability calculations. Post election, we
have the much anticipated revaluation
from April 2017, with over 630,000 ‘blue
forms’ distributed by the VOA.
As property professionals, managing
expectations in 2017 will be difficult
with some geographic areas benefiting
with others not. Budgeting will become
increasingly difficult with new RV’s a new
UBR and new Transitional arrangements,
the details of which will not be known for
some time.
The new government still faces a massive
deficit, and its helps that property taxes
are largely recession-proof, cannot easily
be offshored, are difficulty to avoid and
cheap to collect. The best hope is for
a Structured Review to recommend a
freeze in the UBR.
9
September 2015
Any reliefs are likely to be targeted to
smaller businesses or at least to small RV
properties, with no overall party wanting
to get to grips with the central problems.
Blake has kindly written an article on
Rating and the challenges ahead for this
publication. (See page 20).
A physical presence can complement
and enhance an online service, help
brand awareness and customer relations,
but the ability to touch and feel remains
very important and the social aspect of
shopping as an activity will never
go away.
Calum Ewing, Head of Property at
Metro Bank – Gave an informative
presentation :”Love Your Bank at Last”
about the first new high street bank to
be granted a licence from the FSA for
over 150 years.
The ability to open a new account in less
than 15 minutes and walk out with your
debit card and cheque book is a key
differentiator from the competition.
From a property perspective the bank
will commit to 25 year leases, with
flexibility to break at years 10 or 15, in
prominent high street or edge of town
locations. The accessibility of EoT stores
has helped drive new small business
customers, with ease of access seen as a
“win/win” for both bank and customer.
The morning session concluded with
Sarah Parkinson Partner at Brown
Jacobson discussing the ‘Impact of Omni
Channel retailing on Lease Agreements’.
Technology has dramatically changed
the retail landscape, with ‘Bricks and
Clicks’ and ‘Click and Collect’ now
mainstream terms within the retail
environment. The role of physical stores
has had to adapt to meet these changes
with the most successful retailers having
adopted the Omni channel model.
So what does this mean to the property
professionals? Logistics warehousing and
retail property need to work seamlessly
together in order to fulfil the growing
customer expectation of next day in
store collection.
With high street stores no longer
taking sales just through the till, the
measurement of a tenants’ gross
turnover is blurred when looking at
traditional turnover rent provisions. Who
should get the credit for the sales online
but collected in store or returns made for
online direct sales? There needs to be a
fair balance for both landlord and tenant.
Alienation and user provisions need to
be flexible. What is agreed today may
not be acceptable in the future as Omni
channel retail develops. Flexibility is
key not only to allow for any potential
down-size, but also to allow stores to be
adapted in the years ahead, for example
allowing Click and Collect terminals to
be added / removed without consent.
Other considerations include restrictions
on hours of use and the potential for
some stores to act as a distribution
centre for online orders.
In conclusion retailers should get
www.propertymanagersassociation.com
The bank is totally funded by customer
deposits and has ‘no legacy issues’
around IT, Staff or funding. Metro Bank’s
first branch opened on the 29th July
2010 in Holborn and their acquisitions
programme has seen the portfolio
grow to 34 branches. Focusing on
convenience and accessibility, including 7
day a week opening, the bank has plans
to open a further 150 branches, mainly
within London and the South East.
10
September 2015
specialist advice; we are crystal ball
gazing into the future of digital retailing
which is changing at an ever increasing
rate. Needless to say the relationship
between landlord and tenant as a
consequence is also changing and it is
clear that some are adapting better than
others.
Guest Speakers – Afternoon
Continued from Page 9...
Jonathan De Mello of Harper Dennis
Hobbs opened the afternoon session
with a UK Retail Market Overview.
After what has been a long and deep
recession, UK retail is very much in a
growth mode but there have been both
winners and losers. For example the
significant gains in sales resulting from
Aldi & Lidl’s push for expansion have
been very much to the detriment of the
more established food players.
www.propertymanagersassociation.com
HDH’s own research shows that the UK
remains very attractive to international
retailers from around the globe, with
the likes of Five Guys, Mikimoto and
Smiggle all taking space in London.
Shopping centre development is still
not back to pre-recession levels, but the
signs are promising, with new schemes
such as Westgate Oxford and Westfield
Croydon progressing well. Challenges
still remain however, with some areas
of the UK still experiencing a lack of
demand & high vacancy rates.
E commerce growth continues, but
HDH say that growth is slowing and
competition increasing. Major online
players, such as Amazon, ASOS, and
Net a Porter, are now experimenting
with physical space. Former online only
retailers with successful physical outlets
include Rapha and Oak Furniture Land.
In Jonathan’s own summary, the new
retail normal is to adapt to market
changes or die.
Mark Barley and Nikki Powell of Bond
Dickinson provided the legal update for
the event. Their presentation covered
such areas as lease lengths and the
much reported Iceland v Castlebrook
case was discussed. As a County Court
decision this does not set a precedent
but the decision will give some
encouragement to landlords to
push for longer terms.
The widening of a User clause is unlikely
to be accepted, unless anti-competitive,
as was the case of Martin Retail v
Crawley Borough Council. Here the
Landlord was seeking to impose a
prohibition against convenience store
use to protect a nearby convenience
store, with the tenant looking to widen
the user to allow a similar use. The court
held the Landlord’s proposed restriction
anti-competitive and allowed the Tenant
to widen its user on the basis the Tenant
agreed to pay additional rent.
The final session of the day fell to
Nick Sewell of New River Retail who
provided a current investors perspective
on retail investment. As a very active
owner/asset manager, with 29 shopping
centres and 9 retail warehouse schemes
(as at May 15), New River Retail have
significantly increased funds under
management from £165m in 2011 to
£848m in 2015. Nick commented that
there have been significant changes
within the industry with significant under
investment in the high street and more
secondary locations.
11
September 2015
Andy Bates (Footlocker)
Simon Williets PMA President
Nick highlighted a number of key
schemes that New River Retail had
invested in over recent years. These
included Regent Court, Leamington Spa
where they had successfully repositioned
the centre into a thriving food & leisure
destination which in turn had improved
occupancy rates.
David Moore (Lambert Smith Hampton)
Feedback since the conference has
been very positive overall (comments
on catering have been duly noted).
The committee is here to support the
membership and as always welcome any
suggestions for future topics or events.
David Broadbent - Boots
In closing his presentation Nick
highlighted the need for vibrant
occupied centres with convenient
parking, the need to embrace new
technology and in his own words, be
fast, be bold, be different.
Connect
with PMA...
Linkedin login: [email protected]
Tell us what you think and
share your views with the
members and Committee!
twitter login: PropertyManAsso
facebook login: Property Managers Association
12
September 2015
Member Spotlight
www.propertymanagersassociation.com
Holland & Barrett
Holland & Barrett have over 145
years of experience in Health Food,
Vitamins, Minerals and Herbal
Supplements. We are Europe’s
leading Health Food retailer.
space offering customers more
exciting products than ever before
including an extensive “free from”
range. We plan to open circa 50 of
these large stores in the next 5 years.
Our stores are a familiar site in
almost every major city. We are
currently trading from over 1,060
stores worldwide (of which 738 stores
or located in the UK and Ireland).
We operate circa 90 franchise stores
in China, Cyprus, Dubai, Gibraltar,
Iceland, Kuwait, Malta, Spain
and UAE.
We will be on target to refit circa 70
stores this year and plan on refitting
circa 110 stores next financial year.
We are on track to open circa 90
company owned stores (mixture
of new and relocations) in the year
ending Sept 2015. Of these 90, 26
stores will open in the short space
of 2 months! We anticipate our
acquisitions plans to carry on at the
same pace over the next 5 years.
In May this year we have embarked
on a rebranding programme for
our stores. Our Benelux stores that
trade as De Tuinen and Essenza all
are being rebranded in to Holland &
Barrett. We are truly well on the way
to becoming an International wellknown and respected brand.
In April 2015 we opened our first
“Holland & Barrett More” store in
Chester. This is currently our largest
store with circa 6,000 sq ft of sales
Our manufacturing and distributions
centres are currently located in Burton
(UK) and Beverwijk (Holland).
We are always proactively looking
for premises within regional
shopping centres, high-streets
and neighbourhood centres in all
locations for future growth.
13
September 2015
For Holland and Barrett International
Property Enquires contact:
Acquisitions:
David Dingwall
Phone: 07824504481
[email protected]
Estates:
David Calladine
Tel: 02476215516
davidcalladine@
hollandandbarrett.com
Holland & Barrett International,
Samuel Ryder House,
Barling Way, Eliot Park
Nuneaton
CV10 7RH
Tel: 02476 215400
Web: hollandandbarrett.com
www.propertymanagersassociation.com
Our acquisitions team are actively
seeking new store opportunities
ranging from 1,000 to 7,500 sq ft,
whilst our estates team are proactively
managing our existing portfolio.
Member Spotlight
Due to our rapid growth and
expansion plans for the next 5 years
we are looking to increase our headoffice site in Nuneaton from 30,000
sq ft to 78,000 sq ft of office space!
We are always looking for people
to join our ever growing property
department.
14
September 2015
Legal Update June 2015
Don’t expect the court to get
you out of a hole!
www.propertymanagersassociation.com
In a recent case, the Supreme Court
has upheld a literal interpretation of
service charge clauses in 99 year leases
of chalets on a leisure park, all of which
provided for payment of a fixed annual
sum of £90 compounded each year at
the rate of 10%.
The tenants argued that these clauses
would result in such an increasingly
absurdly high service charge in the
later years of each of the leases that
it could not be right to interpret them
literally (it would mean that, for a lease
granted in 1980, the service charge is
already over £2,500 for the relatively
limited services provided and will be
over £550,000 by 2072). They argued
instead that, by applying commercial
common sense, the compounded
figure should be interpreted as a cap
on the maximum amount that the
landlord could recover each year.
The Supreme Court ruled that when
interpreting a written contract, it had
to identify the parties’ intention by
reference to what a reasonable person
(having all the relevant background
knowledge) would understand the
relevant clause to mean. On that basis,
the majority of Law Lords decided that
the natural meaning of the clauses
was clear and felt unable to give them
a different meaning just because the
amounts payable might substantially
exceed the parties’ expectations at the
time when the leases were granted.
Whilst this is a case on chalet leases,
the lesson to take from it is relevant to
all contractual agreements (including
commercial leases). The mere fact that
a contractual arrangement has worked
out badly for one of the parties does
not justify a departure from the natural
meaning of the relevant contractual
provision. In other words, don’t rely
on the court to get you out of a bad
bargain!
Talk to us:
Sarah Parkinson
[email protected]
15
September 2015
The provisions of the Landlord and
Tenant Act 1954 provide Tenants
with the right to renew their business
leases. In the absence of agreement,
the terms of the renewal lease will be
determined by the Court in accordance
with sections 32-35 of the 1954 Act.
This note will look briefly at a number
of recent Court decisions on lease
renewals.
Iceland Foods Limited v
Castlebrook Holdings Limited
[2014]
this renewal reached Court, the only
outstanding points were rent and term.
The Tenant (Iceland Foods) was seeking
a five year term at a rent of £37,500.
The Landlord (Castle) proposed a 15
year term at £182,350. After hearing
lengthy and detailed expert evidence
and personally inspecting many of the
comparables, the Court determined
that the new lease should be for a term
of 10 years without a Tenant break at an
initial rental of £63,000 per annum.
The decision came as something as a
surprise. The purpose of the 1954 Act
is to protect business tenants and the
general view has always been that a
Court is unlikely to award a term longer
than the Tenant wants. The Court cited
the following key factors:
• The interests of both parties;
This is a County Court decision and so of
limited binding authority. However, the
decision (particularly as regards term and
costs) sits at odds with previous case law
and many of our retail clients are already
seeing this decision being used as a
bargaining tool against them.By the time
• The previous lease was for
35 years; and
• The Tenant’s strong national trading
performance.
www.propertymanagersassociation.com
A review of recent case
law on Lease Renewals
under the Landlord and
Tenant Act 1954
16
September 2015
Despite the Court’s award being
almost 1/3 of the rent sought by Castle
and Castle’s refusal to accept Iceland’s
invitation to resolve the dispute by
PACT the Court declined to make any
costs order against Castle.
Edwards and Walkden (Norfolk) v
Corporation of London [2012]
Continued from Page 15...
This case involved 51 claims for new
tenancies brought by meat traders
within the Smithfield Market. The key
issue to be considered was whether
the rent should be inclusive of service
charge (as in the current leases) or
whether the Tenants should pay a
separate variable service charge in
addition to the rent (as requested by
the Landlord).
Notwithstanding that on initial
review, this case is similar to the very
familiar O’May, the Court reached a
very different conclusion. The Court
decided that a variable service charge
would be fair and ensure that over time
the Landlord neither profited nor lost
from the services it provided to the
Tenants. The Court cited the following
key factors:
www.propertymanagersassociation.com
•Previous leases had a variable
service charge arrangement removed
on renewal in the 1980’s as the City
intended to carry out a refurbishment
programme;
•A provision in the current leases
stated that on renewal the issue of
service charge should be determined
by the Court; and
•The Landlord had agreed to bear the
costs of significant historic disrepair;
and
Martin Retail Group Limited v
Crawley Borough Council [2014]
Again, a County Court decision
concerning the renewal of a newsagents
shop within a small parade of shops. The
user clause in the current lease was for
a newsagents, tobacconist confectioner
or stationer only. The Tenant sought to
extend the user clause to permit use
as a convenience store. Conversely,
the Landlord sought to impose a new
restriction prohibiting sale of convenience
goods, groceries and alcohol.
The Court held that the user clause
proposed by the Landlord infringed
competition law. The Court considered
that the parade of shops in which the
premises were located only contained
one outlet which was permitted to
operate as a convenience store and
so in effect, this outlet was protected
against competition from other shops
in the parade. As a result, the Court
allowed the Tenant to widen their
user clause on if the Tenant paid any
additional rent associated with that
wider use clause.
Nikki Powell
Managing Associate
T: +44 (0) 2380 20 8423
E: [email protected]
17
September 2015
The PMA at 40
Past Presidents
A 40th birthday can certainly be a
pivotal moment as it is an opportunity
to reflect on the past as well as setting
out future aspirations. It has certainly
been an honour to lead the PMA
throughout its 40th year, but I would be
the first to acknowledge our debt to the
PMA’s founder, former Presidents, and
past and present Committee members.
Property Managers Association was
founded in 1975.
Our Founder Member and President
for many years was Nigel Burton
Nigel Burton 1975, 1976, 1977, 1978,
1979, 1980, 1981, 1982
It is for this reason that we invite our
members to attend a 40th Anniversary
Drinks Party at the Bear & Staff Pub
in Bear Street, Leicester Square, on
Tuesday 6th October. This will be a
lunchtime function and, as well as
current members, we intend to invite
past Presidents and a number of guests
who have contributed over recent
years to our success & standing within
the retail sector. Please join me in
celebrating this important milestone!
Simon Williets
President 2014, 2015
John S Furnival 1983,
Terry J U Willcox, 1984
John S Furnival 1985, 1986
Neil Mackenzie 1987, 1988
John S Furnival 1989, 1990
Paul A G Young 1991, 1992, 1993
David Stathers, 1994
Neil Mackenzie 1995, 1996
Raefe J Watkin-Rees, 1997, 1998
Adrian F Trotter 1999
Graham S Hewitt, 2000
Ashley J Ritchie 2001
Mike Stevenson, 2002,
Richard White, 2003, 2004
Mike Harrison, 2005, 2006
Joe Simons, 2007, 2008, 2009, 2010
and 2011
James Hamilton, 2012, 2013,
www.propertymanagersassociation.com
Other Past Presidents are
listed below:
18
September 2015
Lunch Time 40th Anniversary Drinks Party
Bear and Staff, 10-12 Bear Street,
Leicester Square, London,
Tuesday 6th October, 12.30pm to 4pm
Drinks and Food!
Help us Celebrate!
To book a place please email
[email protected]
Or call 01799544905
@PropertyManAsso
19
September 2015
Raising
funds for:
Venue: London Hilton Metropole, Edgware Road
Date: Thursday 17th December 2015
Time: 12.45pm - 6.45pm
Format of the event
Application form
Member name:
Company name:
Tel:
Email:
Address:
12.45pm Drinks Reception
1.45pm – Lunch
Places and Tables available
Guest Speaker
No of places required:
Raffle and Auction raising funds for Scotty’s Little Soldiers
How to pay
PMA Awards Presentation
Invoice required Yes
Price
Debit
£65pp plus VAT (£78.00 inc VAT)
Cheque payable to Property Managers Association
Includes 2 course lunch with cheese, tea/coffee
Reserve your places now
Complete and return your booking form:
By email [email protected]
By post Event office, The Dolls House, Wendens
Ambo, Saffron Walden, Essex, CB11 4JL
No
Credit Card
VAT Registration Number: 666 2816 11
Booking Conditions:
This booking form represents a VAT Invoice:
Booking is final and no refunds will be made in the event of cancellation.
For more information or to sponsor this event please contact:
Louise Oliver 01799 544904
20
September 2015
www.propertymanagersassociation.com
Rating Revaluation 2017
– the race is on
The rating revaluation that was deferred
from 2015 to 2017 is now under way.
The Valuation Office Agency (VOA)
has started the task of valuing all 1.9
million non-domestic properties in
England and Wales, and the Assessors’
offices are undertaking the same task
in Scotland. The valuation date is 1
April 2015 so the new rateable values,
which will be published in draft on 30
September 2016 and will come into
force on 1 April 2017 should reflect
rental values at the end of the first
quarter of this year.
What will be the impact of the
revaluation? We will not know for sure
until the latter part of next year when
we have seen the new rateable values
and know about the likely new Uniform
Business Rate (UBR); but this could well
be the most redistributive revaluation
since 1990. Rental values in many
locations have fallen dramatically and
this is likely to be the first revaluation
where the aggregate rateable value
across the whole country falls. If that
is the case the government is not just
allowed by the legislation, but actually
required, to increase the UBR so as to
maintain the same aggregate tax yield,
in real terms, across the whole country.
Many commentators expect the UBR to
rise above 50 pence if the government
is indeed to maintain its tax yield. This
would mean that the locations and
property types that will benefit are
those where the fall in rateable value is
greater than the rise in UBR. There may
be locations where the fall in rateable
values is offset by the increase in the
UBR and the effect is neutral. There will
also be locations, particularly in London
and the South-East, where ratepayers
face a “double whammy” of increased
rateable values and an increased UBR.
What should ratepayers do about
the changes? The first task is an
administrative one and it is dealing with
the 690,000 “forms of return” that the
VOA will issue this year seeking rental
and other information to help with its
task of carrying out the revaluation.
The second challenge is that of
managing expectations. Many
businesses have a view that “rents have
21
September 2015
fallen 30%, so rate liability will fall by
30%”. This will not be the case because
the UBR is likely to rise in a way that will
offset, at least in part, the fall in rateable
values. And in some parts of the country
there is likely to be the effect I have
described of increased rateable values
and an increased UBR. These can be
important and high value locations
for many retailers – I am thinking here
especially of central London. Even in
locations where rate liability falls the full
benefit may not occur from day one –
there could be a scheme of transitional
adjustments (“phasing”) which phases
in both increases and reductions in
liability. The revaluation is likely to be
good news for the retail sector, but
it may not be as good news as some
may expect or hope for, and in certain
locations it may actually be bad news.
Finally, there is the challenge of
budgeting for the period beyond
2017 when everything changes – new
rateable values, a new UBR, and a new
scheme of transitional adjustments –
and the details of those changes will
not be known until autumn 2016. With
the postponement of the revaluation
businesses have got used to stable,
if very high, levels of rate liability and
budgeting for changes to those stable
levels of liability is always a challenge.
The trick will be to manage
expectations and to recognise that, as is
often the case with taxation, any good
news may not be quite as good as the
taxpayer is hoping for!
Blake Penfold
[email protected]
This year’s Christmas Lunch will be raising funds for
Scotty’s Little Soldiers
Scotty’S
SoldierS
Inspired by the experience of Army widow Nikki Scott, the
charity honours husband Corporal Lee Scott’s memory - both as
a loyal soldier and a loving father - and provides a practical yet
personal way for the public at large to show their appreciation
for those brave individuals who make the ultimate sacrifice in
the service of their country.
Scotty’S MiSSion:
“To provide relief from the effects of bereavement to young
people up to and including the age of 18 years who have
suffered the loss of a parent killed whilst serving with the
armed forces of the crown.”
www.scottyslittlesoldiers.co.uk
Registered Charity No. 1136854
www.propertymanagersassociation.com
Scotty’s Little Soldiers is a charity dedicated to supporting bereaved
British Forces children.
22
September 2015
retailers working together
Supermarkets Group
23
September 2015
Please contact: Louise Oliver
The Dolls House, Audley End Business Centre, Wendens Ambo,
Saffron Walden, Essex, CB11 4JL
T: 01799 544904 F: 01799 542991 E: [email protected]
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