E-tail warehouses set for huge rates rise - report
They’re one of the big winners during the pandemic and continue to reap the benefits of the still-growing demand for e-commerce. We’re talking logistic warehouses. But their occupiers are now braced for a dramatic rates hike, according to a news report on Friday.
With digital retail firms desperate to grab more and more space, rents in the industrial and logistics sector have rocketed and will continue next year. And that will mean business rates rises of up to around 50% in London, potentially pushing up prices for major retailers such as Next, John Lewis, M&S and Amazon, CityAM said.
Rental growth means they will see average increases of 18.7% across the board on business rates payable from April 2023, according to a forecast by Colliers.
Rates in London are set to rise on average by 50.2% following the next revaluation, with the South West of England seeing rises of 32.5% and the South East 30.6%.
The report said a unit in London, with a current rateable value of around £500,000 will find its rates bill rise from £266,000 a year to £399,630 a year, following the revaluation.
Colliers estimated that Amazon’s biggest distribution centre in Tilbury, Essex, which currently pays an annual rates bill of around £3.625 million will see its annual bill rise to £4.745 million, an increase of 30%.
John Webber, head of business rates at Colliers, said: “For those occupying a large number of properties in the sector… these rises will mount up, particularly for operators who have prime sites in London and the South East and those in the South West. This will have a significant impact on their overheads from 2023 onwards.”
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