In recent years our High Streets have changed shape, with vacant shops and buildings becoming a regular occurrence. In 2021 figures suggested 172,000 commercial properties were vacant, with 8 out of 10 of these properties being empty for more than 2 years.
With there being no sign of matters improving, the Government has stepped in with its ‘High Street Rental Auctions’ proposal which is currently at the consultation stage. The proposal will give local authorities the power to auction the rental rights of commercial high street property that has been vacant for longer than 12 months in a 24 month period. This could be 12 months continuously or a cumulative total of 12 months spread over the two years.
The High Street Rental Auctions process will allow a local authority to find people who would be willing to take a tenancy of the vacant property, ascertain the rent for the tenancy and compel a property owner to enter into the tenancy.
The process will involve the local authority giving the landlord an ‘initial notice’ that they intend to undertake the High Street Rental Auction Process in respect of its premises. This will give the landlord 8 weeks to find a tenant. If the landlord can find a tenant, they can only enter into a lease with the local authority’s consent.
If the landlord is unable to find a tenant, the local authority can put the premises under a ‘final notice’ meaning, unless the landlord decides to appeal against the final notice, the local authority has 12 weeks to auction the property and complete an agreement for lease. The lease itself does not need to be completed within the 12-week period.
The consultation is seeking views on aspects such as the auction process, proposed new Permitted Development Rights, and disapplication of Minimum Energy Efficiency Standards among other things. The deadline for responses to the consultation is 23 June 2023.
To discuss Commercial Property issues, please email us at info@ramsdens.co.uk or call us on 01484 821 500 to speak to a member of our team.