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Refurbished property rates case to be taken to the UK Supreme Court

Property developers state that if the Supreme Court were to rule against them in the refurbished property rates case, certain London transformation schemes would be negatively affected.

Property developers plan to consult the UK’s Supreme Court to ask for the increased business rates rules to be invalidated. The rates were changed 18 months ago, and have since cost property developers millions of pounds.

The changes have meant developers now pay full business rates on vacant office premises which are being refurbished, when previously, they paid next to nothing.

Property developers plan to ask the Supreme Court to dissolve the blanket rule and instead specify the state the vacant offices need to be in to require the developers to pay full business rates.

Lawyers representing the property developers on this case believe that the ruling has caused major difficulties for some urban redevelopment projects in London. Developers themselves state that as much as £8m had to be paid as additional rates for some projects.

Structural Defects Insurance

The current challenge against the ruling originally arose due to a disagreement between a Sunderland office owner and the Valuation Office Agency (VOA).

Refurbishing of the Sunderland office had begun before the new rules for business rates were in effect, however, the developers were still forced to pay the new rates by the VOA.

Property developers are said to be pleased to see the case in the Supreme Court, according to Roger Cohen from Berwin Leighton Paisner (the law firm representing the BPF and RSA). Mr Cohen also believes that the new ruling on business rates does make it difficult to follow through on some London development schemes, as it is not likely that owners can prove it is uneconomic to do the repair.


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