Rent rises ''inevitable'' - commercial mortgages

04 October 2007

Changes to the law on empty property rates along with other issues will mean that firms with commercial mortgages are all but certain to raise rents next year, it has been advised.

Higher costs for land and development will couple with the more restrictive empty property regulations to oblige owners to raise rents as a way of recouping costs, according to the Liverpool Daily Post.

From April 1st next year owners of empty properties will have to pay business rates, with the likely effect that developers will no longer be able to buy property and leave it empty while they work out the best way of developing it, article author Tony McDonough has suggested.

"Land values in the region are increasing. Add to that increased construction costs, steel prices and the cost of complying with legislation," Mr McDonough wrote in the Daily Post.

"All this has to be fed into development appraisals, meaning rents will climb, not because of demand but to make development viable," he added.

Last month it was suggested that owners consider appealing against rateable values in an effort to limit the costs incurred.