Upper Tribunal clarifies rating valuation of buildings undergoing redevelopment

19 June 2019

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The Upper Tribunal (Lands Chamber) has recently issued its decision in the case of Jackson (VO) v Canary Wharf Limited (2019) UK UT136 (LC). This was an appeal made by the Valuation Officer which in effect sought to vary the definitive decision on redevelopment, created by the Supreme Court’s decision in SJ & J Monk v Newbigin (2017).

The Upper Tribunal (Lands Chamber) has recently issued its decision in the case of Jackson (VO)  v Canary Wharf Limited (2019) UK UT136 (LC). This was an appeal made by the Valuation Officer which in effect sought to vary the definitive decision on redevelopment, created by the Supreme Court’s decision in SJ & J Monk v Newbigin (2017).

The case involved an office building at Canary Wharf. When the tenant left the landlord immediately stripped back the office to a shell but the reconstruction wasn’t intended to take place until a new tenant was found.

The VO’s case was that the property should still attract a full value as there was no evidence of continuing the programme of works to refit the offices.

The crucial question was whether the office was capable of beneficial occupation which should properly be the starting point of all similar appeals.  

In the Canary Wharf appeal the offices weren’t capable of beneficial occupation at the material day so couldn’t be valued with the normal rating assumption of being in a reasonable state of repair, ie closely reflecting reality.

Interestingly, the Upper Tribunal did distinguish between deliberate disrepair created by redevelopment and disrepair caused by theft but the starting point remains whether the building in its actual state at the material day is capable of beneficial occupation.

As with Monk, it is reassuring to find the hypothetical world of rating closely reflecting real world situations.

The Leekes Retail and Leisure Group have substantial property assets within the group and have engaged Andrew West to appeal against rating assessments on these properties since 2010. We have consistently been impressed by Andrew's knowledge of the property market and his negotiating skills have been exceptional. Given Andrew's outstanding performance, we would not hesitate to recommend Andrew to any business large or small seeking to appeal their rates liabilities.

Mike Fowler, Group Finance Director, Leekes Group