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.

Cooke & Arkwright have looked after our property assets in South Wales for many years. Their knowledge of the South Wales market coupled with enthusiasm and willingness to go the extra mile has ensured we keep ahead of the market.

James Rodge, Rockspring