Businesses relocating to properties within Birmingham’s Enterprise Zone are likely to miss out on the business rates relief which is intended to give them the incentive to move. According to rating experts at property management consultancy CBRE, only one building in the central business district, Two Snowhill, will qualify for the full relief.
Two Snowhill is the 310,000 sq ft office development delivered by Hines and Ballymore earlier this year. It is one of 26 designated buildings or development sites in the city’s Enterprise Zone, which covers 68 hectares.
According to Jonathan Buckle, the head of CBRE’s rating team in Birmingham, most of the other buildings and sites within the Enterprise Zone catchment may not be able to take advantage of the full £275,000 relief available.
Mr. Buckle stated that most of the sites are either development sites or properties that require “substantial refurbishment.” Many of them are not currently under construction and will not be ready for occupiers in the short or medium term.
These properties will not benefit from the scheme because, to qualify for full relief, tenants must be on the premises by March 31, 2015.
A number of development sites are currently struggling to get funding without a pre-let and it’s likely that they won’t be on site in time to make the deadline for the full rates relief, according to Mr. Buckle.
He believes that more than half of the designated Enterprise Zone sites, including projects such 103 Colmore Row and Masshouse Phase II will almost certainly miss the window.
Tenants who agree to take a single floor (measuring 25,000 sq ft) at Two Snowhill will save £2.20 per sq ft off their annual occupation costs for five years.
