We, again touch on Business Rates to see how both Landlords and Tenants might be able to help each other; we look at potential savings in Water efficiency, Civil sanctions for environmental offenders and also offer up some Telecom/Data help for those looking for an upgrade on Communications.
Finally our Q and A considers some aspects of self –help for Corporate compliance which might be relevant for your business.
Britain is now beginning an austere period but even so it seems that, according to recent research, company confidence is returning. As the pound regains some of its strength against the euro, imports are becoming more affordable and coupled with (a degree of) political stability, is leading some to believe that future business prospects are more favourable than they were 18 months ago.
Recent research, conducted by Fidelity Income Risk Monitor Index (FIRM), supports the idea that the number of business failures has, and will, decrease throughout 2010. Even though the general outlook is looking better some sectors still continue to struggle. Do you fall into one of these sectors?
The report commented on the 3 main sectors; Offices, Retail and Industrial and found at the peak (Q2, 2009) there was a failure rate across all these sectors of 3.51%. Not surprisingly the Industrial sector was considered the riskiest, followed by Retail and the Office sector. Currently FIRM have revised their failure rate down to 2.96% due in part to the belief those companies that were weak have now already failed and those that remain are more resilient to economic challenges being experienced.
The RICS identify ‘Property Costs’ as being the second largest outgoing that a firm will budget for, each year. Furthermore, the commitment to a commercial lease will be the longest contractual arrangement a company will make, and often the most inflexible. For a tenant, thoroughly understanding the leasehold obligations is paramount
in ensuring your business remains safe. It will also help to support the relationship an occupier will have with their Landlord because any discussions will be meaningful and an efficient use of time.
Experience tells us that Landlords have a greater appreciation for those tenants who can demonstrate an understanding of their obligations. A company that appreciates those obligations will operate more efficiently and will be better prepared for these challenging times.
TAP can guide you through the daily complexities that flow from signing a commercial lease, simply call us and we can talk you through any issues you may have with your occupation.
Are you a Landlord who would like to reduce the rating liability across their portfolio or are you a tenant who may want short term space. Both Landlords and Tenants may want to be looking at ways of making use of vacant premises in order to:
1. reduce Landlord's overheads, and
2. generate a use for a range of occupiers who may need short term flexible accommodation...
The 2 can come together and could well help the Landlord with his Rates liability, by triggering Empty Property Rates Relief.
As we have previously reported, April 2008 saw the introduction of tighter restrictions for Landlords on their ability to claim relief, in an effort to encourage them to re-let premises however this has stimulated a dramatic backlash from those same Landlords who have endured recessionary pressures over the past 18 months leading to a harmful reduction in Tenant demand.
A loophole does exist, however whereby a Landlord can look to secure temporary lets and if this is achieved for periods of 43 days, this time frame allows him to apply for 3 months empty rates relief; at the end of 3 months the Landlord can agree another 43 day 'letting' and continue this process indefinitely. In order for this to work, both the Tenant and Landlord need to be on the same understanding and one key area is in being able to prove ''occupation''. This needs to be physical and not merely being able to prove to the Billing Authority that there is legal possession granted.
Dated photographs should be taken and a recognisable paper trail needs to exist to, at the very least, give evidence of intent.
Landlords, however also need to be vigilant of those looking to exploit the loophole even further and there is growing evidence of rogue traders signing up for temporary lets, having rates bills diverted to them and then walking away after 43 days. If there is insufficient evidence of 'occupation' the Authority may well throw the entire Rates bill at the Landlord. That same Landlord should be wary of the Tenants requesting their share of the Rates saving at the outset of the 3 month period and any such suspicions should ring alarm bells.
Generally, however Authorities are not seeking confrontation but will be on the lookout for evasions and therefore we would urge all parties to be as up front and clear as possible so that the Authority has a chance to inspect and form their view; TAP would however envisage this loophole being closed, as its usage is becoming more widespread.
TAP has access to leading Rating advisors so contact us for further information and clarity.
Changing weather patterns and population growth are adding pressure to the available water in England & Wales. The Environment Agency predicts that UK groundwater levels will begin to decrease in 15 years and that within 40 years the amount of water available in English and Welsh rivers will be 15% less than current levels. As with Energy, when will the Government begin to increase tax on water consumption?
However, presently companies can receive tax breaks if they invest in water saving technology. Benefits can be obvious in terms of cost savings (a manufacturing company can readily be spending 1% of turnover on water related activity) but more obliquely, companies that are seen to be taking efficiency measures can satisfy the increasingly demanding needs of Stakeholders, who are looking ever closer at CSR matters. This can lead to customer retention and improving prospects for new business.
Water supply to a business is either direct, i.e. taken from a tap or a company's water resource or indirect, i.e. that which is used to produce a product or service and it tends to be the control of the Direct supply that can make the most meaningful difference to a user, and a systemic approach could see consumption reduced by 50%. Methods to consider will include water saving and recovery/re-use devices, leakage detectors/shut-off systems, the use of sprays and jets for cleaning or aeration sprays under lower pressure, metering and monitoring systems which will be used to evidence and benchmark usage and can also be used to compare data with other similar companies.
One major cost saving can come in the form of a Tax break, whereby companies paying UK Corporation Tax can claim 100% of first year capital allowances when purchasing eligible water related products for their business.
Many water efficient technologies are also eligible for tax relief and appear on the Water Technology List, where over 2,000 are listed and you can also visit Business Link (Water Efficiency) to see how to introduce good practice into a wide variety of workplace environments.
TAP has access to industry leaders in Environmental consultancy and we can put in touch with our service partners, so feel free to contact us.
Upon the understanding that most environmental offences are unintentional, a new and more proportionate Order has recently come into force which allows the environmental regulator to impose Civil Sanctions on an offending business, rather than going straight to prosecution with penalties and/or imprisonment.
The Environmental Civil Sanctions (England) Order 2010 came into force on April 6th and is drafted to try to allow greater flexibility for both the Regulator and business and, whilst currently only effective in England, starts out by looking to cover offences which might cause harm to water and wildlife or create poor drainage and waste management. Sanctions which can be used include:
Compliance Notice (written notification to seek discontinuance or recurrence)
Restoration Notice (written notice to restore harm caused by an offence)
Enforcement Undertaking (a voluntary agreement by a business to take corrective action)
Fixed Monetary Penalty (low level penalties ranging from £100 for an individual to £300
for a company)
Variable Monetary Penalty (for more serious offences up to £250,000)
Stop Notice (written notification to cease causing harm)
There are opportunities for the offender to object or appeal to an independent Tribunal however non-compliance with any of the sanctions can then lead to prosecution or legal action which of course is where the criminal procedures take over.
TAP has teamed up with industry leading Environmental consultants to assist businesses in this field and we would be delighted to direct your enquires to allow your business to plan for perceived or real risks.
Whether you are forming a new business and are just about to take new premises or are relocating, getting your telecoms configuration right is very important according to STL Communications Limited. Like moving house, maintaining communication links can be very stressful and is very often business-critical. Planning for Telecoms and data is vital and TAP has set out below a few things to be thinking about to assist you in that process.
Regardless of an old or new system, line installation and number allocation can take anywhere from 2-8 weeks depending upon the quantity required.
Fast broadband is essential and so it is prudent to check with your ISP the available speed at your new location. The speed is very closely linked to your proximity to a telecoms Exchange.
For the sake of business continuity you may be looking to keep your existing telephone numbers; however a move to a new Exchange can often remove this possibility, although an expensive call divert is possible. New technology can assist here, so TAP recommends detailed research to see how things have moved on.
New IP telephony gives you the option to keep existing numbers, reduce lead times, increase flexibility and simplify installation. Voice over IP (VOIP) transmits telephone calls over data cables and also means that you should only need one land line into the building with all other lines working from THE CLOUD.
You will be hearing a good deal more about THE CLOUD in months and years to come, as this generic term relates to Internet enabled services controlling your Telecoms and Data remotely, whereby systems can be hosted off-site and your infrastructure is accessed via an Icon into the internet.
This technology can provide a complete communications solution between Office, mobile, home and your entire infrastructure which can save you time/money and aggravation. Its flexibility can make planning for the future a good deal easier, allowing you to 'bolt-on'/remove additional/surplus capacity as and when required.
Because businesses infrequently make a premises move, it’s hard to keep up with how technology has moved on, but this can be a great opportunity to review how systems have evolved. The traditional 'workplace' is being affected by several factors, namely square footage cost, congestion and associated lost hours but also by technology, allowing staff to work more remotely and flexibly.
TAP’s data and Telecoms partners are happy to discuss how your next move or upgrade can be improved; please call us on 0800 865 44 50.
I understand what my Landlord is responsible for, as part of his obligations, under the terms of lease. I need to think about my covenants and wondered if there was any company that could help me comply with my obligations?
There are many companies that can assist you in understanding your obligations, some better than others. Early on within any decision making process, as a company, you should decide who, within the organisation will be responsible for this part of the business. When you have identified an individual, think about their current role and see how much time they could devote to ensuring that property compliance is achieved. When you have reached this point, then those appointing an external company or consultant will have a better understanding of how much support is required.
There are aspects of occupying a commercial property where there will be a need to maintain, monitor and reflect on property matters on a regular basis. This may include, cleaning windows, maintaining air conditioning units, updating fire risk assessments, reviewing asbestos management reports or portable appliance testing. Having a stringent monitoring and management system is important in order to demonstrate to the regulatory authorities that matters are being kept under control. If a company has no awareness of the elements required to meet compliance, then this would increase any risk exposure should an inspection by a regulatory body, such as the local fire authority, wanting to look at a Fire Risk Assessment be undertaken.
It is important to identify what obligations you are required to carry out and then decide whether you need to appoint a Facilities Management Company, or a team of consultants who can guide you through which sub contractors you will need to have to achieve compliance. ‘House keeping’ cannot be under estimated as it reduces the risk to your company by identifying early on what areas of your business require monitoring or maintaining.
There is no simple answer to your question without first deciding how you want to approach the problem.
If in any doubt please call TAP on 0800 865 44 50 and we can guide you through any concerns you may have.
