ISSUE 6 | SEPTEMBER 2016
Section 63 New regulations under Section 63 of the Climate Change (Scotland) Act 2009 are now fully in force and landlords of eligible non-domestic properties are obliged to work towards reducing Scotlandâ€™s greenhouse gas emissions. Whilst we already touched on this topic in our last edition of Property Matters, the costs involved and potential implications on commercial property transactions are not to be overlooked and thus we have chosen to expand further and reiterate the significance. As part of the international effort to battle climate change, the Scottish Government has set targets to reduce Scotlandâ€™s greenhouse gas emissions by 42% by 2020 and 80% by 2050. As non-domestic buildings are accountable for a large portion of these emissions, Section 63 of the Climate Change (Scotland) Act 2009 has introduced The Assessment of Energy Performance of Non-Domestic Buildings (Scotland) Regulations 2016 which place a duty on a number of commercial property owners to assess and improve the energy performance of their buildings. Section 63 came in to force on 1st September 2016 and applies to the majority of non-domestic buildings (or parts thereof) over 1,000sqm being put on the market or offered for sale or lease to a new tenant. Alongside the existing requirement for an Energy Performance Certificate (EPC), a Section 63 Assessment is now a mandatory process for these buildings. This assessment produces an Action Plan setting out carbon and energy savings targets that the building will achieve if specified improvement works are undertaken. The regulations have set seven standard prescriptive measures (improvement
How does it affect you?
works) and the Action Plan places a duty on the owner to undertake all of which are applicable to the building in question. The owner is then provided with a 42 month timeframe to complete the works and have an updated EPC prepared to finalise the procedure and prevent enforcement action. The seven prescriptive measures are as follows: 1. Installing draught stripping to windows and doors; 2. Upgrading lighting controls; 3. Upgrading heating controls; 4. Installing an insulation jacket to a hot water tank; 5. Upgrading low energy lighting; 6. Installing insulation in an accessible roof space; 7. Replacing a boiler if older than 15 years. Whilst these works may seem minimal, costs can mount up considering the size of buildings they apply to. However, it is possible to negotiate alternative improvement in lieu of these prescriptive measures providing they still achieve or exceed the initial savings targets set down in the Action Plan. This may be beneficial for the owner if they already have upgrade works planned for the building or if less expensive works are possible which will ensure the most cost effective package is implemented. Owners do have the option of deferring implementation of the works by recording the operational ratings of the building through a Display Energy Certificate (DEC), however these certificates must be updated annually for as long as they wish to delay. If they fail to have the DEC updated on time they must automatically revert to completing
the improvement works. The decision on whether to proceed with this DEC route will likely be determined by comparing the long term annual DEC assessor fees and the need to update against the actual costs of undertaking the works. Whilst there are various minor exclusions to a building having to undergo the Section 63 procedure, such as the type of transaction and the age and current efficiency of the property, these regulations should not be overlooked by any party involved in commercial property transactions. As a Section 63 Assessment is triggered by the sale or lease, it is probable that implications will arise concerning liability under a commercial property lease and, in terms of a purchase, the Action Plan affecting the value of the building which is likely to be adjusted to compensate for the cost of the works This article is not intended to cause alarm but we believe it is prudent that you are aware of these regulations. If you require any further information or wish to find out if your building is affected, Iona Foubister and David McCurdy have undertaken the statutory training and are available for all non-domestic energy assessment enquiries. Please do not hesitate to contact one of our energy team for more information. Iona Foubister, Building Surveyor DD: 01224 597514 M: 07788 393628 E: email@example.com David McCurdy, Senior Building Surveyor DD: 01224 597512 M: 07776 204638 E: firstname.lastname@example.org
Message from our MD... Our Range of Services - getting that message across. It is important that existing and prospective clients are fully aware of the range of services that FG Burnett can offer, like every other professional services business getting that message across is key for us and if we can add value to clients’ needs then everyone benefits. Often clients are unaware that we can provide a particular service; to avoid that our team cross sells other departments, our website needs to clearly illustrate what we can do and our “hard copy” marketing material should do the same. Thankfully satisfied clients also spread the word on a job well done and I would thank them for that endorsement. From time to time we carry out client satisfaction surveys. Feedback is important and I would ask that you contact me or your regular FGB contact if you wish to tell us how we performed
and how we can improve our service. Every department provides a range of services, non-more than Building Consultancy who undertake an extensive list of tasks which include Building Surveys for clients looking to purchase individual properties or portfolios, Dilapidations for landlord or tenant, Schedules of Condition for attachment to leases, Contract Administration for refurbishment projects together with Project Monitoring and Project Management for larger projects and new builds. We also undertake Planned Preventative Maintenance, EPC’s and Section 63 Assessments, Reinstatement Cost Assessments and performing the role of Principal Designer/CDM Adviser. Our Property Management team look after a wide range of property assets from multi let office buildings, industrial estates and shopping centres to the common parts of large residential developments. The needs
of each client are different and we tailor our service accordingly from a full service including rent collection and administration of service charges to a temporary caretaker service during a void / marketing period. Our property management IT system flags up all lease events automatically ensuring effective asset management in relation to rent reviews, break options and lease expiries. Other departments liaise on an ongoing basis with the property management team to investigate whether there are particular opportunities for the client in engaging with occupiers on lease regears to improve capital/ investment value. Our Building Consultancy department works closely on the managed estate in a number of areas including dilapidations (both interim and terminal), refurbishments, project monitoring and scheduled redecorations.
P3 The FGB Agency team are active in the office, industrial and retail property sectors. We have dedicated experts in each sector ensuring that clients receive a tailored service from a professional who is close to current market trends. In addition to the core leasing and selling service we also acquire property for clients on either a retained basis or by introducing on and off market opportunities to clients whom we know are in the market place for a particular product. Our market knowledge allows us to source specific product for clients on an off market basis, particularly in the investment market where a black book of contacts is key. We are involved in development appraisal work, often working as part of a team of assembled professionals including Architects, Cost Consultants, Planners, and Engineers depending on the nature of the scheme. Our input in terms of financial viability, market demand (occupier and funder/ investor) and tenant mix is important to the client. We act for both landlord and tenant clients in relation to negotiating Rent Reviews and Lease Renewals. We also become involved in lease regears where the parties are looking to renegotiate existing terms, usually around break options and lease expiry date in return for a change in rent or a capital / rent free incentive.
Formal disputes can arise in relation to rent reviews and we are represented on the RICS Scotland Chairmanâ€™s Panel of Arbitrators & Independent Experts. Our Valuation team act for a range of clients including the major lenders, commercial and corporate occupiers, local businesses and investors. They work closely with agency, investment and building consultancy colleagues, to ensure that our clients receive the most accurate advice. The team advises on single properties/ investments through to large portfolios in the main commercial property sectors. We provide independent valuations, within agreed timescales, in accordance with RICS Valuation Professional Standards. The department carries out specialist valuations including football stadia, research & educational facilities that can include componentisation of the existing buildings for accounts purposes. Our Rating department provides a comprehensive advice service covering all aspects of business rates. The prime objective is to ensure that the client is paying no more than necessary for this significant business overhead. In order to achieve this objective, we will review valuation notices and rates accounts, lodge appeals against valuations where appropriate and ensure that the client is obtaining any discounts or relief which is available.
We will soon be entering a critical part of the business rates cycle with the next general Revaluation due in April 2017. There is a limited period of 6 months in which to challenge the revised Rateable Values which will determine the amount of rates payable for the next five years. It is therefore particularly important at this time to get the right advice in relation to the appeals procedure. We also provide clients with advice regarding Compulsory Purchase Orders where private property rights require to be acquired in connection with the provision of public works. We assess and negotiate financial compensation claims. This work is highly specialist, our expert is Keith Petrie FRICS who has 40 years of experience in this field. We have been involved in all the major and most of the minor public works schemes in the North East of Scotland since the 1980â€™s and currently we are heavily involved in the AWPR and Third Don Crossing schemes as well as the forthcoming Berryden Corridor project. You will see that there is more to us than you might expect, more experience, more services, more sectors. If we can help or if you want to know more please get in touch. Richard J. Noble E: email@example.com
Office Opportunities Albyn Place Whilst it is no secret that the office market in Aberdeen is challenging just now there are no doubt opportunities for those who are looking to downsize, rationalise, or simply upgrade the quality of their office accommodation. For the first time in 7 years there is opportunity to acquire extremely high quality open plan office accommodation on Albyn Place with no’s 26, 27 and 28 being released by BG / Shell. The last time an office of this nature and specification was available on Albyn Place was in 2009
when No 28 was completed and ultimately acquired by BG Group. These buildings offer the perfect combination of high quality traditional cellular meeting and conference rooms in the original villas with modern spec open plan floor plates to the rear. All buildings offer an excellent parking ratio and amenity such as a café at No 27, gym at No 26 and outdoor terracing at No 28. Whilst the buildings are held on leases, all expiring in July / August 2019, the opportunity exists to agree a longer term deal with the Landlords.
The Silver Fin The Silver Fin Building remains on track for completion in March 2017. A topping out ceremony complete with piper was held on Wednesday 31st August and marks the landmark event in the construction phase. The 132,000 sq.ft office building, being developed by BA Pension Trustees Ltd and Titan Investors is now taking shape and a tour of the building – even in its current phase of construction – is well worth the lung bursting trek to the top floor (…or maybe that’s just me), thankfully there will be 5 high speed elevators in place when the building is operational. The views West are second to none whilst the return glazing to the East elevation In the periphery, tenants are taking occupation of their brand new office facilities. AAB have taken occupation of their new 45,000 sq.ft office HQ on PrimeFour Business Park. KCA Deutag will soon be moving into their
provides a tremendous aspect of the harbour. The business lounge at ground floor will provide a unique feature in a modern city centre office building allowing tenants the ability to have informal meetings and a client waiting area all with access to coffees and teas from a trained barista. Uniformed reception and security staff will greet you on arrival and will make the Silver Fin welcome is a unique experience in Aberdeen. Whilst the Silver Fin Building boasts of floor plates of 12,700 and 17,300 sq.ft, the floors have been developed so as to be divisible into suites upwards of 4,000 sq.ft. new 70,000 sq.ft office HQ at City South and the Lloyds Register HQ at Prime Four Business Park – 100,000 sq.ft, is well under construction and due for delivery early 2017. All of this activity is raising the bar in
We are soon to announce the first letting of c. 26,000 sq.ft which will undoubtedly increase interest with potential occupiers and be a vindication of the 5 years of planning and detailed design all of which has resulted in a development which would not look out of place in the City of London. terms of office product in Aberdeen. The market remains challenging, but tenants now have the chance to acquire quality space on financial packages which have not been available in Aberdeen for many years.
By Graeme Watt Graeme.firstname.lastname@example.org
A Tidal Wave of Lettings... New deals suggest there is certainly still life in the industrial market in Aberdeen. Acting on behalf of landlord Standard Life, FG Burnett has recently concluded 4 new transactions at Ocean Trade Centre, Altens, including two new lettings and two lease renewals. These show a continuing interest and
commitment to the market. The units ranged in size from 2,300 sq.ft to 5,000 sq.ft FG Burnett Director and Head of Agency Graeme Watt commented: “These transactions confirm that Ocean Trade Centre and Altens continue
to be popular with a wide range of industrial occupiers. They are a further demonstration of continuing activity in the industrial property sector despite the challenging market.” Of a total of twenty five, only one unit is available at Ocean Trade Centre and it extends to 2300 sq.ft approx.
Relocate or Renew that is the question? Notwithstanding Aberdeen’s challenging market conditions, it is still the case that companies across all sectors need to service their own and their clients’ businesses. An integral element of a business’s tools is a continuing requirement for property resource, whether this is larger, smaller or the same as they utilised prior to the downturn. Other criteria, such as quality of building and location also factor into the equation. By way of example it is apparent and perhaps a slight relief that despite the downturn, there has not been the
leakage of industrial occupiers away from the city that may have been first feared. Don’t get me wrong, there have been some unfortunate casualties but in the round there are more holding on rather than disappearing. This resilience has led to increased activity on the lease renewal and lease extension front with both landlords and their tenants adjusting their aspirations to the change in the demand and supply conditions. In short, tenants have sought and have been granted shorter leases
and increased incentives though headline rents have, for the moment, generally, held up. The prognosis for the short term future is that tenants /occupiers will continue to be reticent about making long term commitments and this will lead to continuing, perhaps even increased, lease renewal activity. The paradox may be at as second hand property becomes increasingly more attractive and in greater demand, values may rise. The message, act quickly to avoid disappointment.
Aberdeen - Ground Leases & Ground Rents
A Practitioners Concern By Graeme Watt Graeme.email@example.com
In the late 1960s and through the 1970s the forefathers of Aberdeen City and Shire were sufficiently forward thinking, astute and driven from an economic development perspective to promote, advance and ultimately, release large areas of agricultural ground around the city and shire for commercial property development. At the time the USP was why employ and tie up valuable capital to buy the ground when you could have a low cost entry and lease it for 99 years, amortise the development cost over a long period and secure the investment. Over time and for various reasons, these ground lease assets were sold off by ”the Councils” into the private sector.
What could not have been contemplated nor appreciated at the start of these leases was the full commercial impact that some of what might be described as “standard terms” were eventually to have. Like most leases these agreements provide for “upward only” rent reviews and full repairing obligations. What this means is that firstly, while capital values fluctuate, ground tenants are committed to paying what could be described as the full or top rent achieved from time to time with no prospect of reduction even if market conditions change dramatically; take 2015 to 2016 for instance. Secondly, ground tenants are committed to maintaining their
buildings throughout the period of the ground lease to the extent that, if required, they are obliged to rebuild.
acre. This is significantly in excess of, and in some cases may be argued as much as double what current capital values actually are.
Quite an undertaking for 99 years!!!
It remains to be seen what the next development may be but, there is no doubt that in the face of challenging market conditions, there will be ongoing efforts by ground tenants to reign in further rental growth but it is by no means an easy task. Agents who act for ground tenants are in close liaison in order to ensure that as far as possible these efforts are concerted.
And so we come to the current concern. Set against the backcloth of the ground landlords’ legitimate ongoing desire to asset manage their portfolios in early 2015, one of the ground landlords, (at the height of the market) bought back the building of one of their tenants, cleared the site and put that site (0.5 acres) back on the market thus testing the market by way of a new ground lease. They were successful in their campaign to the extent the successful bidder, at a competitive tender, agreed to pay the equivalent of £51,000 per acre per annum. The under-bidders also bid at premium levels. Ground rents prior thereto had just reached £26,500 per acre per annum. As a consequence, and not unsurprisingly, the ground landlords immediately set about trying to reaffirm and flush that evidence across their portfolios but needless to say, this was rejected by ground tenants for various reasons. One of the disputes led to an arbitration with an effective date of May 2015 and was thus, a test case. I won’t go into the nuances of the arbitration process, and it is a private process, but the award was at a level of £34,817 per acre per annum. This is obviously substantially below the £51,000 per acre per annum but still a significant increase on previously established rentals. To put that in context £34,817 per acre per annum roughly equates to a capital value of c. £800,000 per
Of perhaps greater concern though is the fact that this somewhat unjustified increase could not have come at a worse time for ground lease tenants, particularly those who own industrial property. As highlighted above, market conditions in Aberdeen are very challenging and together with the recent changes to the empty property rates regime for industrial property and the introduction of Section 63 of the Climate Change (Scotland) Act they have conspired to adversely affect the capital value of assets held by way of ground lease. I would recommend that you closely review these assets, particularly if there is secured lending. This article is a personal opinion and is not intended to cause alarm but I believe it is prudent to be aware of current market conditions and factors which could possibly affect value.
I wonder what the forefathers would have thought...!
When No One’s Home...
...How an empty property presents its own management challenges By Christopher Yannaghas – Christopher.firstname.lastname@example.org There may be many reasons why a property falls vacant – for example a lease has come to an end and the tenant has moved out, or a previous occupier’s plans to rationalise their business space can mean that a premises is now surplus to requirements. From a management perspective the owner must be sure that the property is safe and secure and not at risk from malicious damage whilst there is no one on the premises. The insurers of commercial property perceive vacant buildings to have a very high risk level and hence could have a consequent effect on premiums. Insurers will insist that if a property remains vacant past a certain amount of time then the owner must undertake certain tasks to ensure that the risk is managed. These tasks – known as unoccupied property warranties – set out a number of steps that must be taken to secure the property whilst it remains unoccupied for the medium to long term. As well as ensuring that the insurance premiums do not increase, they also form the basis of a sensible and practical property management regime to protect the property asset whilst it remains empty. At the top of the list are those steps which reduce the possible chances of
arson or wilful fire raising. The vacant property and immediate external area must be cleared of all combustible materials. Steps must be taken to seal the letter box which helps prevent junk mail building up, and also to stop any attempt to start fires by pushing burning items through the letter box. Finally, the insurers may require windows and other entrances into the building to be boarded up to ensure that the property is as physically secure as possible. Whilst not often specifically requested by insurers, physical security could also include laying rock armour at the entrance to the site itself so that no unauthorised vehicles can drive onto the property. Contractors would then need to be brought in to drain down all the wet services in the building, again protecting it from possible wilful damage should anyone break in, but more importantly the possible effect of a burst pipe in winter time, when an escape of water could go unnoticed for some time. Where power supplies are concerned these will have to be shut off at the incoming mains although insurers will usually permit a lighting circuit to be left on together with any circuits that support fire and intruder alarms. Gas supplies must be switched off at the mains and valves locked off where possible.
After all these tasks have been completed it is usual for insurers to stipulate that the property must be inspected regularly. This means that the building must be checked either on a weekly, or fortnightly basis, and each visit logged. We recommend to clients that this is best done by a security contractor as they can also act as key holder in the event of a problem that occurs out with normal business hours. The Property Management Department has implemented these services to deliver clients’ unoccupied property warranties on a number of buildings, being in the advantageous position of being able to access a wide range of specialist contractors. Furthermore, we have also been able to negotiate advantageous rates with a local security firm that can be passed on to our Clients. Finally, working with our rating surveying colleagues can assist with any vacant business rates issues, and our Building Surveyors are on hand should any major repairs be required to the property. If you would like to discuss the management of a vacant property then please contact either Christopher Yannaghas on 01224 597510, Bryan Robson on 01224 597513 or Simon Smith on 01224 597508.
A Year in Investment By Dave MacLeod - email@example.com
As an investment agent I can say that the last year has been one of the most varied years in my career, advising on over £70 Million of investment transactions in the last 12 months. It has been a pretty decent run in a challenging market and the variety of the work has been fantastic. Last summer we acted for a highly regarded local legal practice, to advise on a sale and leaseback of their offices the marketing was discreet and we identified a very experienced local investor who bought the buildings. In the autumn, we acted on behalf of private clients from Singapore on the £10.875 Million acquisition of the Brodies office and the CMS Cameron McKenna office - both superb buildings in Aberdeen’s west end, let on long leases to very strong tenants. At the same time, we were advising one of Scotland’s iconic food groups on a transaction in the Highlands between their pension fund and operating company, following that with a preChristmas, off-market acquisition of a multi-let industrial estate in Aberdeen for a private client. As winter was on its way out, we acted on behalf of Sacred Heart Aberdeen
Ltd, on the £12.75 Million sale of St Joseph’s School and The Bishop’s House on Queens Road to Aberdeen City Council - a particularly long and sensitive transaction which will allow the Council to invest further in the future of the school, bringing an end to our client’s 121 year ownership of the property! Early spring saw the completion of the £24.0 Million sale of the KCA office HQ at City South Business Park on behalf of Dandara - another long lease deal to a private investor at a yield which demonstrated the continuing demand for quality investment product. “Summer“ deals in 2016 can only be aligned to the calendar and not the weather, but we were delighted to act again for Drum Property Group on the sale of the Anderson Anderson Brown investment at Prime Four to a private European investor, the latest successful pre-let and investment sale on the development. A discreet marketing campaign on behalf of a private client, also saw the sale of The Specsavers on High Street, Elgin. Dandara’s success continues with the pre-let of the M&S Simply Food store at Stoneywood, where we act as letting and investment agents. There has been strong interest in the investment, primarily from private
From left to right: Specsavers, High Street, Elgin; KCA HQ at City South Business Park; M&S Simply Food at Stoneywood.
investors. Finally, the acquisition of a Filling Station investment in Aberdeen for a well-known UK property company - confirmation of the interest in alternative sectors. On the negative side, the shock Brexit vote saw the collapse of a deal where we were acting on a significant industrial investment acquisition for a major European fund manager confirmation of the uncertainty that stalks a market where sentiment is in plentiful supply, but transactional data and evidence is not. So, we have advised on offices, industrial, retail, food manufacturing, a school and a filling station - deals that involved buyers and sellers from Aberdeen, Singapore, Edinburgh, Dublin, Cyprus, London and Glasgow! An investment agent is nothing without expert local knowledge and I rely heavily on my colleagues throughout the company, particularly the agency team who are doing deals on a regular basis across the country, providing me with excellent transactional intelligence. We are delighted to have acted on these deals for such a superb and varied set of clients - the common theme being that the majority of buyers are private investors seeking quality, long term income.
Reinstatement Cost Assessments and the impact on your business. Reinstatement Cost Assessments (RCA’s) are simply put the assessment of the rebuilding cost of existing construction. Whilst it is very common for desktop update valuations to be requested by clients it is strongly recommended that full re-inspections of the buildings and land are undertaken every 3-5 years. In recent months FG Burnett have undertaken several RCA’s for long standing clients where we have not inspected the premises for the specific purposes of Insurance Reinstatement in c 15 years and as such there have been relatively large increases in the sum insured i.e c 20%. This is partly attributable to uplifts in material and labour costs in the intervening period however in these particular scenarios the owners also carried out refurbishments/ improvements to the premises which could not be considered when assessing on a desktop basis. The implications of being under insured for these particular clients could have been significant, in all of the cases at least part of the buildings insured consisted of significant Granite premises (some of relatively significant architectural merit) and should there have been an incident it is extremely likely that the Insurers would have applied average to the claim which would have meant the clients were faced with the potential liability to fund the shortfall of any claim themselves (i.e up to 20%) which is likely to have been a significant sum. It is therefore extremely important that when accepting instructions from clients that the basis of the valuation is understood as well as the extent of the buildings/land to be included within the assessment which will ensure the correct level of information is obtained during the inspection. All insurance policies are contracts of indemnity with the objective to place the insured, as far as is reasonable, in the same financial position after a loss as they were before it. The basis on which indemnity is measured will vary to suit different circumstances. The most common variants of assessment likely to be requested are as follows:
(a) Day One Reinstatement; The majority of buildings in the UK are insured on a ‘Day One Reinstatement’ basis meaning claims are settled on a ‘new for old’ basis. In theory it does not matter how old a building is or what its state of repair. If insurers have agreed indemnity by reinstatement cover, the damage to the building will be repaired to a condition substantially the same as, but not better than or more extensive than, its condition when new and the insured will not have to contribute to any betterment in achieving that state. (b) Reinstatement including inflation provision; The basis is as per the Day One basis however there will be one sum insured inclusive of an allowance for inflation and it is this sum which will be used for premium calculation and average purposes. In practise it is generally found that the Insurance Company/Loss Adjuster will take the information provided in the Day One valuation and apply inflation themselves which is generally advantageous to the Surveyor as their skills do not necessarily extend to expertise in inflation. (c) Reinstatement less wear and tear (‘indemnity’ basis); This basis of indemnity is a feature of most policy wordings but, in practice, few buildings are insured on this basis of indemnity. It is a rarely used method however may be attractive when a building is very old or in a poor state of repair and the insurer may be unwilling to grant full reinstatement cover or the insured may wish to save premium by having a lower sum insured whilst accepting that there would be significant and inevitable betterment contribution to be made in the event of repairs being necessary. (d) Market Value; This method of valuation is rare and will require the input of several Surveying Specialisms to produce. If repairs to a building insured on an ‘indemnity by reinstatement’ basis are not carried out then the insured is not entitled to an equivalent payment in cash. Instead, any claim will be based upon the diminution in market value as a result of the damage i.e. the value of the buildings (and site) the minute
before the loss and the value of the remains of the buildings (and site) post loss (This being the measure of loss, provided that this does not exceed the cost of repairs.) (e) Obsolete buildings; This basis of assessment could be suitable if a building were to be demolished and rebuilt in a different and cheaper form if it was destroyed or seriously damaged (for example substantial granite buildings will by their nature have a significant rebuild cost and replacement in a more modern material may provide advantages in terms of the policy premium). Partial damage would be repaired up to an agreed amount but beyond that amount the building would be knocked down and replaced by a modern building providing the same function. The premium would be calculated on the full cost of reinstatement of the existing building with a reduction to reflect that the insurers’ limit of liability is a lesser amount based on the demolition of what remains of the original building and the cost of the modern replacement. (f) Site clearance, debris removal and ‘making safe’ costs only; If a building is due for demolition no material cover may be necessary if, when damage occurs, the date of demolition can be brought forward. However, the cost of demolition may be higher as a consequence of the damage or, if demolition cannot be brought forward, additional costs may be incurred in making the building safe in the meantime. (g) Second-hand value of building materials. This form of assessment of value is rarely requested. A building due for demolition or even redevelopment may have no value except that arising from items which have a second-hand value, such as fireplaces, architectural features and roofing tiles. If that second-hand value could be lost as a result of damage then that value can be assessed. For more information or enquiries in relation to RCA’s please do not hesitate to contact our Head of Building Consultancy, Jim Johnstone, at firstname.lastname@example.org and he will be happy to discuss the above and advise accordingly.
Retail Property Focus Wilkies expansion provides positive news for Ballater...
Richard Noble - 01224 597528 email@example.com David Henderson - 01224 597538 firstname.lastname@example.org
10 year lease for the 3,853 sq. ft. of accommodation. The store opened its doors at the end of July.
Ballater had a difficult start to 2016 with flooding devastating large parts of the town centre, especially affecting the homes, shops and businesses toward the South end of Bridge Street.
David Henderson commented “securing Wilkies so quickly was very important for the town and we’re delighted to have played a part in this. We wish Wilkies every success and are confident that they will become an established part of the Ballater retail scene.”
Long established occupier McEwens of Perth ceased trading in late spring but FG Burnett acting for the landlord secured established Scottish fashion retailer Wilkies who made a long term commitment to the town taking a
Wellington Road Aberdeen Retail Opportunity. Acting on behalf of CBRE Investors FG Burnett are marketing an attractive retail warehouse with dedicated parking immediately adjacent to Halfords and fronting Wellington Road, the A956 trunk road. Other occupiers in the vicinity
include Tesco, Lidl, Screwfix and Topps Tiles. The unit provides 5000 sq ft of modern open accommodation and is available immediately subject to completion of legal formalities. Contact Richard Noble for details.
Opportunity to Acquire Entire Building In Aberdeen City Centre It is relatively rare for whole buildings to become available to purchase on Union Street Aberdeen. We are pleased to bring an opportunity to the market on behalf of SSE plc. 156 Union Street occupies a prominent location with impressive neighbours including Cafe Nero, Lakeland, Flight Centre and KFC. The accommodation comprises good quality sales on ground and first floor
levels with basement, second and attic floors providing staff, office and storage facilities. Total accommodation is 629 sq m ( 7449 sq ft) approx. Subject to the appropriate planning consent being secured this building is suitable for a variety of uses. Offers over £700,000 exc of VAT are invited, please contact David Henderson or Richard Noble for further details.
Pitch Strengthens with arrival of Family Shopper FG Burnett are pleased to have represented the landlord in a letting at Rousay Drive neighbourhood centre to the first Family Shopper convenience store in Aberdeen. The operator has taken 3750 sq ft on a 10 year deal. The parade within which the unit is located is now fully let.
Credit due in delivering Forres and Aberdeen Sale... FG Burnett continue their activity in the North completing a recent sale on behalf of a private client of premises at 53 High Street Forres. The purchaser of the ground floor and basement unit extending to 199 sq m ( 2146 sq ft ) approx is Forres Area Credit Union who are relocating within the town. Carrying on the sale theme FGB have recently completed the sale of the prominent two storey detached building at 90 Loch Street to private clients on behalf of Remnant Kings. The property extends to
404 sq m (4344 sq ft) approx. and is located close to John Lewis, Tiso and the Bon Accord Shopping Centre. David Henderson who steered both deals to conclusion commented “ despite the current uncertainties in the economy we are finding that there is a steady demand from parties looking to purchase commercial property either for owner occupation or investment purposes, particularly more modest lot sizes in the £250000/ £500000 price range.
Nisbets open in City Wharf, Aberdeen Aberdeen recently welcomed the UK’s largest supplier of catering equipment. Headquartered in Bristol, Nisbets have offices throughout Europe and export to over 100 countries worldwide. Our clients are delighted that they chose the City Wharf development in Aberdeen City Centre, joining Ibis, Pure Gym and Grosvenor Casino. Richard Noble commented “Nisbets have completed an excellent fit out of their new
Aberdeen store and we look forward to welcoming occupiers to the adjacent units”. Nisbets have taken a lease of 650 sq m (7000sq ft) two units of 571 sq m (6146 sq ft) and 311 sq m (3348 sq ft) remain available, these can be combined and competitive terms are available. A 375 space NCP car park forms park of the development. Contact David Henderson or Richard Noble for information.
2017 Business Rates Revaluation If you are an owner or occupier of commercial property, it is likely that you will have received requests from the Assessor for rental and other information over recent months. This information is collected prior to each revaluation and will form the basis of the revised rateable values which will apply from 1st April 2017. Thus it is important to ensure that the information returned to the Assessor is accurate and complete. If you require any advice or assistance in connection with requests for information you have received our rating team can help with the completion of these forms. Notwithstanding the well-documented challenges faced by the North East
economy in the wake of falling oil prices and the knock-on effect this has had on activity in the commercial property market, it is anticipated that the 2017 Revaluation will result in significant rises in rateable values and rates payable. This is due to the fact that the â€˜tone dateâ€™ for the 2017 Revaluation was 1st April 2015 when the oil price was still approximately twice the current level and the full effects of the downturn in the oil industry had still to be felt in the property market. If you are concerned about the potential impact of the 2017 Revaluation on your own business premises we can advise on individual
properties and provide preliminary estimates of 2017/18 rates payable for budgeting purposes. It should also be noted that the Scottish Budget for 2016/17 contained provisions to amend / reduce the level of rates relief available in certain circumstances. These changes affect Fresh Start Relief, New Start Relief, Renewable Energy Generation Relief and more widely, Empty Property Relief, particularly in relation to vacant industrial buildings. If you require further information on how these changes may impact on your own circumstances please contact Scott Strachan who heads our Business Rates Department.
Key dates to remember... January 2017
New rateable values will be available on Scottish Assessors Association website
Revised valuation notices will be issued
New rateable values come into effect
April to September 2017
Opportunity to challenge the new rateable values through the appeal process which is limited to the 6 month period following revaluation.
The next Rating Revaluation will take effect on 1st April 2017, speak to our team to ensure you are prepared.
We hope you enjoyed the latest edition of Property Matters and we would love to hear your thoughts or suggestions for future articles. At FG Burnett we are passionate about sharing our knowledge and are always keen to learn more so if you would be interested in joining our business to business knowledge sharing CPD programme then please get in touch.