High street boost as business rates set to drop

A reduction in business rates should give high streets a welcome boost - although we continue to see Norwich bucking the national trend with increased interest from retail tenants.

Last year saw a fall in market rents and values for prime retail units as occupier demand for high street space continued to decrease in the wake of the pandemic.

Despite this, retail tenants continued to pay business rates based on the Valuation Office Agency’s 2017 revaluation which set Rateable Value figures as at 1^st April 2015, when the market was stronger and retail values were higher.

However, in what is some very good news for the retail sector, as a result of the Chancellor’s Autumn Statement last November, from April 2023 retail occupiers could benefit from a reduction in their business rates payments.

This is because of the Valuation Office Agency’s Rateable Value assessments being brought more in line with the current (and in most cases, lower) values.

Norwich seems to buck the national trend anyway when it comes to retail occupancy, with a number of recent lettings demonstrating that there is still strong interest from national occupiers to open shops in the city."

Katie Bates, Commercial Surveyor, Norwich

A quick search on the Valuation Office Agency’s website shows that this change could mean the business rates payable at one shop in Gentleman’s Walk, Norwich would decrease from £39,168 to £29,440 per annum in April. Another shop in nearby White Lion Street could decrease from £18,089 to £14,471 per annum.

Norwich seems to buck the national trend anyway when it comes to retail occupancy, with a number of recent lettings demonstrating that there is still strong interest from national occupiers to open shops in the city.

Recent activity includes the opening of the Breitling Watchmaker and Rituals stores in Chantry Place, Loake Shoemakers taking a shop in White Lion Street and Chopstix Noodle Bar opening in Gentleman’s Walk.

It is also promising to see businesses investing in their Norwich shops; Beaverbrooks has just reopened following a significant refurbishment and House of Fraser has announced it will be refurbishing its premises in Chantry Place.

The unit in Back of the Inns, Norwich, formerly the Castle Fine Art gallery which relocated, was let to Lucy & Yak by our Commercial team.

We at Brown&Co recently let 13, Back Of The Inns to sustainable clothing retailer Lucy & Yak, a business that began online. It specifically targeted Norwich for its third shop location having recognised the market’s relative resilience here.

So, the reduction in business rates payable will hopefully increase the affordability of retail units and attract interest from prospective occupiers to the vacant properties in the city.

Hopefully, these changes will help to stabilise retail market rents in Norwich and support the continued success of transactions in the city centre.

For more information contact Katie Bates, Commercial Surveyor, Brown&Co on 01603 629871.