I have been dealing with a number of Notional Rent Assessments for clients recently which of course means speaking to the District Valuer. We get on very well with the 4 or 5 people we regularly come across which of course makes it a lot easier to try to agree an increase to a client’s Notional Rent.
One thing that has been bothering me recently is the number of times a client tells me, or the District Valuer tells me directly, that Current Market Rents associated with Notional Rent are going down.
It bothers me because from my personal experience all the clients I deal with who refer their assessments to us have either been offered an increase or achieve a bigger increase by instructing us to negotiate on their behalf. I have yet to come across an assessment carried out by the District Valuer that involves a reduction in the Notional Rent.
The evidence the District Valuer team puts forward is that assessments for new build schemes, on a per square meter basis, have been dropping. To back this up they can quote a number of schemes where this is the case.
What they fail to realise, which has been backed up by some very interesting data released by the Primary Care Property Forum (of which I am a member), is that there are other issues at play for new build one-stop shop surgeries, such as the inclusion of pharmacies and dental suites. It’s because of these issues, which only affect new build schemes, that initial rents are lower.
The point of all this is that, while the commercial property market may still be in the doldrums, Primary Healthcare property is still in demand and is still showing signs of growth despite what the District Valuer may say. If you happen to speak to one of the valuers you may wish to query them on this, or more preferably give us a call and we can give you an independent view on any assessment made.