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More Than 80,000 Shops Could Close By 2017 Without Overhaul Of Business Rates

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Maybe the landlords should charge less, instead of gloating of their returns on back of business - although no doubt some will tell us its the pension funds that hold the property.

Since 2008, pre-tax profits for the largest retailers have fallen 32pc but their business rates bill has grown by 27pc.

Return On Cash - Commercial Property Is North Of 7%
Started by Panda, Feb 17 2015 04:52 AM
http://www.housepricecrash.co.uk/forum/index.php?/topic/203293-retrun-on-cash-commercial-property-is-north-of-7/

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That's boIIocks. Business rates are high because land, property and rental values are high. Which is the point and therefore the economic signaling relates to land and rents, not the rates derivative. A reduction in business rates will just lead to an equivalent increase in rents accruing to landlords anyway.

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Retail is toast. I realised this last weekend when I needed a pair of AA duracells. Option 1: go to a physical shop, and buy them, involving time and diesel. Option 2: click a few buttons and get them delivered the next day for £1.08. I chose Option 2. Yes, I know there are great chunks of retail that need physical presence (clothes, at the moment), but there is still a awful lot that is going to go bust in the next 10 years. I would run a mile from retail property for the foreseeable future.

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Retail is toast. I realised this last weekend when I needed a pair of AA duracells. Option 1: go to a physical shop, and buy them, involving time and diesel. Option 2: click a few buttons and get them delivered the next day for £1.08. I chose Option 2. Yes, I know there are great chunks of retail that need physical presence (clothes, at the moment), but there is still a awful lot that is going to go bust in the next 10 years. I would run a mile from retail property for the foreseeable future.

I'm increasingly finding that when I go to a shop because I need something urgently, they don't stock it anyway...

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That's boIIocks. Business rates are high because land, property and rental values are high. Which is the point and therefore the economic signaling relates to land and rents, not the rates derivative. A reduction in business rates will just lead to an equivalent increase in rents accruing to landlords anyway.

Tired mind, but suspect you're bang on there.

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Tired mind, but suspect you're bang on there.

+1

I take back my previous point, this is better

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OK, we've got about 1,000 medium to big towns + cities.

Thats ~80 shops per town.

Tough!

Like north said, closed shops are a market signal that rent + rates are too high.

Look, retail is running away from the old model of trying to put a shop in everywhere town and city.

All the big operators want to have one large regional outlet. They've sussed where the flows going.

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Retail is toast. I realised this last weekend when I needed a pair of AA duracells. Option 1: go to a physical shop, and buy them, involving time and diesel. Option 2: click a few buttons and get them delivered the next day for £1.08. I chose Option 2. Yes, I know there are great chunks of retail that need physical presence (clothes, at the moment), but there is still a awful lot that is going to go bust in the next 10 years. I would run a mile from retail property for the foreseeable future.

Oh and the rest...wait until 3D printing really takes off. There will be a whole host of goods that will no longer need a retail outlet.

As far as the tax issue is concerned, I am afraid that the name of the Government game now is not only to spend less (benefits) but claw back more in tax. Any business area getting a tax break in the future will have had to work bl00dy hard for it.

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Retail is toast. I realised this last weekend when I needed a pair of AA duracells. Option 1: go to a physical shop, and buy them, involving time and diesel. Option 2: click a few buttons and get them delivered the next day for £1.08. I chose Option 2. Yes, I know there are great chunks of retail that need physical presence (clothes, at the moment), but there is still a awful lot that is going to go bust in the next 10 years. I would run a mile from retail property for the foreseeable future.

I never thought Id buy clothes on-line ... but.

Given up on M+S tshirts - I get fuit of the looms one for a fraction of the piece and twice the quality.

Shoes - switched to solovair (docs have been beyondsh1t for 15 years). No bricks retailer so i get them online.

501 - i know my waste + leg len, a combination which shops rarely have in stock. So buy off the net.

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Oh and the rest...wait until 3D printing really takes off. There will be a whole host of goods that will no longer need a retail outlet.

As far as the tax issue is concerned, I am afraid that the name of the Government game now is not only to spend less (benefits) but claw back more in tax. Any business area getting a tax break in the future will have had to work bl00dy hard for it.

name 20

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Hike business rates and force landlords to reduce rents.

My money is on them doing the exact opposite of course

Land Value Tax now.

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Business - commercial + retail - rents are set by big life companies, who have totally distorted the UK commercial environment for the last 30 odd years.

As soon as they lower the rates they have to mark down their investment.

Theyd rather have an empty shop and a pretend valuation than an occupied shop and a real valuation.

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That's boIIocks. Business rates are high because land, property and rental values are high. Which is the point and therefore the economic signaling relates to land and rents, not the rates derivative. A reduction in business rates will just lead to an equivalent increase in rents accruing to landlords anyway.

I was watching over the years a particular restaurant site from the perspective of the EA I was working in.

This site was always up or sale or had a grand opening...the price was double, always, what I calculated a restaurant with that many tables could cover with a mortgage.

recently closed again, the sales price £750K plus rates, plus plus plus plus.

Its like the huge numbers attract a particular kind of entreprenuer, one who doesnt look at the client potential, the costs of the loans, the costs of the staff, the costs of marketing, the costs of fitting out and all the rest, Its almost like this particular place is the jinx of the high street. But, its not the only one.

Theres usually a couple with the "white A4 Notice to Creditors" in the window.

Edited by Bloo Loo

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name 20

Literally anything you hold today made of solid material. State of the art 3D printing makes metal components strong enough for SpaceX to use them in rocket motors - better, quicker and cheaper than cast parts. I think it is going to take a lot longer to happen than most people expect, because at the moment it is a lot cheaper to mass produce things than 3D print them, but that will change in time.

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Business - commercial + retail - rents are set by big life companies, who have totally distorted the UK commercial environment for the last 30 odd years.

As soon as they lower the rates they have to mark down their investment.

Theyd rather have an empty shop and a pretend valuation than an occupied shop and a real valuation.

And they'll exert political pressure "to help the poor shop keepers" to have rates reduced instead of lowering the rent

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Literally anything you hold today made of solid material. State of the art 3D printing makes metal components strong enough for SpaceX to use them in rocket motors - better, quicker and cheaper than cast parts. I think it is going to take a lot longer to happen than most people expect, because at the moment it is a lot cheaper to mass produce things than 3D print them, but that will change in time.

Labour is the biggest cost in production for most items.

printing one thing in one material might be OK, but most likely, you will buy your 5lb bag of Plastic type A for your tap washer, you will buy your 5lb bag of plastic type B for your lawn mower part.

Mass production relies on bulk buys, a ready market to dispose into and a keen price.

Cant see many households getting into 3D in any big way.

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And they'll exert political pressure "to help the poor shop keepers" to have rates reduced instead of lowering the rent

20 years ago - Yes.

Now - Nah. Life companies have exploded as operating, employing, political orgs - no employees = no power.

Now they are no more than hollowed out skeletons, grasping hold of overpriced retail units.

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This discussion has been had before, but again the burden of business rates (and council tax) fall economically on the landlord and therefore impact on rents. That's why it gets headline articles, not due to concern over small businesses and actual enterprise.

e.g. http://www.bbc.co.uk/news/business-16692556

http://www.lawpack.co.uk/landlord-and-tenancy/commercial-leases/articles/article5459.asp

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That's boIIocks. Business rates are high because land, property and rental values are high. Which is the point and therefore the economic signaling relates to land and rents, not the rates derivative. A reduction in business rates will just lead to an equivalent increase in rents accruing to landlords anyway.

Nailed.

This is the retail landlords lobbying government to reduce rates to make room for larger rent rises. The opposite of a LVT.

You can expect the rentier party to heed to their demands. Reduce the size of the state, cut red tape, reduce the tax burden on businesses etc. plenty of neoliberal buzz phrases you can vomit out for this one.

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My response is a bit off topic, but was watching The Enforcers on ITV last week. Yet another propaganda show masquarading as entertainment about High Court Enforcement Officers, where their powers are massively exaggerated.

Anyway this bailiff evicted a bunch of squatters/protestors from a shop and we had to put up with the bailiff's political views about recovering the property for the hard working rentiers, and the scorn he had for thise squatters "maybe you want a suit for a job interview" however at the end of all this, the shop was finally put to use and let....as a charity shop.

So why couldn't this unit that had been empty for sometime, have its used changed to residential?

Because no hard working business could ever afford the rent. The business opportunities to pay these levels of rent just don't exist. I've looked into it locally here, in Yorkshire and you'd be paying hundreds of pounds for every person walking casually past the shop.

Only hope is to put a 'Jobcentre' on every street corner, as they seem to be only means of creating (forced) footfall in town centres in these weird times.

Edited by RentierParadisio

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