Friday, 7 March 2014

Business rates and Margate’s empty shops and a new indoor market to open there.

 During yesterdays visit to Margate something that struck me was the large amount of empty shops in “The Centre” this is the newish partly covered shopping mall that runs between The High Street and Cecil Square.
 Most of these seem to be on the market for about £8.50 a square foot or about £85 per square metre per year, although I would have thought that they could be rented for much less, my guess would be around £5 per square foot, which would mean the rental for a fairly substantial shop, something around the size of my bookshop would be around £100 per week. All in the ballpark of a lot less that than the same area would cost to rent if it was residential accommodation. This is a reflection of the times, wind back the clock about fifteen or twenty years when there wasn’t so much out of town shopping and the rentals here were probably in the £20 per square foot ballpark with residential property rents being much less.  
 
 On the other hand business rates don’t seem to have come down, the rateable value which should be in the same ball park as an annual rent is around the £14.50 per square foot or £145 per square metre. In practice the actual business rates paid are around half of this.
 The issue is more complicated as there is small business rates relief on the first business property you own or rent, but this wouldn’t apply to a second business. There are exact figures but the amount of business rates you actually pay are about half the rateable value.
 




 So let’s say that I wanted to open another bookshop in Margate, I would need a shop of about 1,000 square feet and I would guess I could probably get one for about £5 per square foot per year this means that a 1,000 square foot shop would be about £100 per week but I would be paying about £150 per week business rates, I don’t think this situation would help the Margate shop problem. 
 
The other side of the coin in Margate is the desirable commercial property that is near to the sands and the Turner contemporary and so to end on a much more encouraging note there is a new indoor market opening there.  
 Very much a case of watch this space http://www.theoldkentmarket.com/
 and here are a few of the rest of the pictures







4 comments:

  1. I think a major problem also with those properties is years of neglect by the Freeholder and landlords, some of the shops internally are in a terrible state! Also Edinburgh Woolen Mill shop is soon to close adding another empty shop to the list. You'd think TDC would be doing just about anything to try and bring either businesses or other entities to the area to try and slow down and turn around the decline in the last 10 years!

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    1. Rob these would have been let on full repairing leases, the problem being not enough money coming through the door to pay the overheads, rent, rates, wages, light heat phone and maintenance.

      Wages are the biggest expense, the minimum wage is about £6.50 per hour plus paid holidays, I guess the least you could get away with would be about 100 staff hours a week about £650 you may get the rest to make this up to £1,000 but I can’t see much less and perhaps get a gross rate of profit of 30 to 40% which really boils down to what could you sell £3,000 a week worth of there.

      I have carved this one up with people getting less than a living wage, the property owner getting much less than he would for bottom end residential accommodation on the site.

      TDC don't set the rates or the rents and I don't see there is anything much they could do about this one.

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    2. A couple of years back (shortly before closing down), the High Street greengrocer said to me "This isn't a High Street anymore, it's just a side road", and he's right. I love the Old Town and harbour area, but there's very few "every day" grocery shops. Strange to think that a village like Birchington can support 2 greengocers, yet in Margate there's none.

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    3. It may be something to do with the distance from the larger supermarkets and the age of the population. We certainly do nearly all of our greengrocery shopping in Ramsgate town centre.

      It’s cheaper and the quality is about the same as the better supermarkets, but you do have to carry it and if you have to add on the cost of parking then it is more expensive.

      I had to look at a collection of books at the top of Margate High Street, it cost me £1.40 to park there for an hour, the multi-storey would have been cheaper but I don’t use it because people use the stairs as toilets and I wouldn’t have wanted to carry the boxes of books up there.

      But yes given Margate as busy as it was around 1990 I think if I had opened a bookshop there along similar lines to the one I was running in Ramsgate I think I would have got sales in the 2 to 3 thousand a week bracket now I would think something in the order of 4 to 6 hundred is what I would expect.

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