FASTdan
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| posted on 5/11/14 at 10:58 AM |
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Dividing a commercial premises for Rates reasons
Just wondering if the LCB collective has any experience in such areas.....
We currently have a small workshop attached to a larger 'warehouse' that is currently rented out for storage. Another Motorsport business
has another workshop on the other side of the warehouse (and they are the owners of the entire premises). Currently their section falls well below the
£6000 rateable value threshold for paying business rates (below this the business rates are currently zero) as does ours. The warehouse rates are paid
by the current tenant.
We have all the figures (rateable value of each section per m2) available and have worked out that if we had a 3rd party (another motorsport
enterprise) we could potentially divide the large warehouse into 3, allowing ourselves (danST) to expand into one third, the owner to expand into the
other third and the new party in the remaining third. In doing this we would all fall below the threshold and thus in theory not pay business
rates.
The question is, when dividing up a premises in such a way, what is deemed to be acceptable in order to establish 'division'. The
warehouse is 80ft x 40ft and high (high enough that you could put a 1st floor in for storage), making stud walling possible but quite a task. We also
need to have some 'common' area to allow vehicles to be moved from the main door to any of the facilities - again what are the
implications of this? We can absorb these common areas into any of the 3 sections in terms of rateable area and still stay within the requirements,
but the 'demarcation' would not accurately reflect this. We do not want to get into putting another 2 roller shutter doors, separate
access etc. Likewise the toilet and kitchen facilities would remain shared.
I have contacted the FSB who have pointed us to RICS - who will apparently give a 30min free phone consultation and may be able to advise but just
wondered if anyone on here has any experience of this sort of thing?
NEW danST WEBSITE NOW LIVE! Bike carbs, throttle bodies and more......
http://www.danstengineering.co.uk/
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NOTE:This user is registered as a LocostBuilders trader and may offer commercial services to other users
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gallons perminute
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| posted on 5/11/14 at 11:44 AM |
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I have some experience.
A number of years ago I took on the lease of a place as you describe. It was a large unit divided into 6 smaller units. At the time everyone paid
rates so there was no advantage there. It was a rent issue as the landlord could not find one company for the whole unit but managed to find six
smaller companies to take it on. We moved in and after two weeks we got a writ telling us to get out because planning permission had not been given.
After that was sorted out the next item on their list was toilets for both male and females. Then it was the partition walls that had been built to
split the unit up. They were built using breeze block but that was not good enough for the jobsworths who turned up to inspect things. They wanted
holes cut in the wall to inspect that the walls were correctly attached to the rest of the building in case of an earthquake. ( Glasgow) That was the
final straw. It was obvious that as we were the last in and not yet employing any staff the local council planning dept were picking on us in an
attempt to sort out the landlord. At the time my partner in the business was a lawyer and he managed to get us out of the lease. Goodness knows how
much that would have cost if we had to pay for it. In all 3 months were lost and as a result we lost our believe and gave up on the idea.
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nick205
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| posted on 5/11/14 at 12:04 PM |
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Before moving to new premises (8k sqft) in August this year we explored with our previous landlord dividing our old premises (15k sqft) in two. The
landlord (Post Office pension fund) was interested in the idea as it has a number of large un-let units locally and is finding it easier to let
smaller units.
However when we got into the detail, it involved making the building 2 completely separate units, including; gas, electric, water, waste, phone,
postal address and so on. This was the only way the council would then recognise for rates purposes and similarly the insurers for insurance
purposes.
In our case the cost and grief was prohibitive and the landlord lost interest due to the level of work involved. During that time our current
premises came available through the same landlord so we opted to move as the cheaper, faster solution.
First place to start would be the council IMHO. Without their approval you won't get far!
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