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Category: government and politics
Landlords are being asked to provide their opinions on a new government initiative, the “High Street Rental Auctions”, which aims to address the issue of persistently vacant commercial properties in England.
This initiative is part of the Levelling Up and Regeneration Bill, and local authorities would be given the power to rent out vacant properties to new tenants through an auction process.
The consultation seeks feedback on lease arrangements, costs, and Minimum Energy Efficiency Standard requirements, and how the auction process should be conducted.
Policy Background
According to the government, the extended vacancy of commercial properties is a significant problem for the UK’s high street, with over 80% of vacant properties remaining empty for more than two years, and over 20% remaining empty for more than four years.
Despite successful government actions, such as the introduction of Use Class E to enable more flexible use of existing buildings, vacancy remains high in many areas.
High vacancy rates have a significant impact on the economic performance of an area, stripping economic opportunity from towns and high streets, directly affecting footfall and risking businesses shutting down, more jobs being lost, and lower economic activity in the heart of communities.
High vacancy rates are also linked to wider regional economic underperformances. Some of the worst-affected areas include Manchester, North-East Lincolnshire, Luton, and East Staffordshire, with vacancy rates ranging from 20% to as high as 28%.
Unemployment rates in these areas are also higher than the national average, and between 42% and 56% of vacancies in these regions have been vacant for more than four years.
Vacancy also leads to a decline in the appearance of an area and becomes a target for vandalism, graffiti, and anti-social behaviour, further entrenching economic underperformance.
To address this problem, the government has made regenerating high streets and cracking down on anti-social behaviour a central part of its levelling up agenda.
The government’s goal is to “breathe new life into once-bustling town centres and transform them into vibrant places where people once again want to shop, live, work and relax – restoring local pride as they level up across the country”
The auction process would apply to commercial high street properties that have been vacant for more than 12 months in a 24-month period.
Successful bidders would enter into an agreement for lease with the landlords, and a lease of between one to five years would follow the completion of any pre-tenancy works.
The process would not apply to properties whose landlords are actively seeking tenants or are planning to redevelop the property.
If a landlord is uncooperative, they will be given a grace period of eight weeks to find a tenant. If they fail to do so, the local authority may organise an auction and then enter into a lease agreement with the winning bidder.
In addition to this latest initiative, the government has also developed an “Anti-Social Behaviour Action Plan” that aims to tackle the issue of anti-social behaviour and strengthen landlord ability to evict disruptive tenants.
Provide your feedback
The government is encouraging all landlords to provide their views on the latest initiative, navigate to the official government website.
The duration of the consultation is 12 weeks, ending on the 23rd of June, 2023.
