Scope
The scope of this Practice Note is solely to ensure a consistent valuation approach for this Property Class/ Subclass/ Type for Non-Domestic Revaluation 2023 and subsequent entry in the new Valuation List which becomes effective on 1 April 2023.
The basis of valuation for new entries in the Valuation List, and Rating Revision cases after 1 April 2023, is Schedule 12 (2)(1) of the Rates (NI) Order 1977.
Description
This Practice Note refers to property classified as:
Class: Markets, Marts
Sub Class: Market
Type: Indoor and Outdoor
This Practice Note applies to markets held on private or publicly owned land which does not constitute the public highway, thoroughfare or footpath. Trading will be confined to a definable area of land (which may include buildings) that constitutes the hereditament. Examples include St George’s Market, Belfast and the indoor market at Dock Street, Strabane.
Car boot sales can vary in scale – some are held regularly, others less frequently. The land on which they take place may already be assessed for another use or it may be not be a rateable hereditament. The organisers may be commercial bodies or fund raising charity groups. Where it is considered a hereditament exists, these markets should be investigated with a view to establishing rateability.
What are commonly known as street markets or seasonal/continental markets, are excluded from this scheme. They do not fall within this class. In such cases the market rights constitute the rateable hereditament. These are valued under a separate Practice Note for Rights and Tolls.
Legislative background
Schedule 12 Part 1 Paragraph 1 of the Rates (NI) Order 1977 applies.
“Subject to the provisions of this Schedule, for the purposes of this Order the Net Annual Value of a hereditament shall be the rent for which, one year with another, the hereditament might, in its actual state, be reasonably expected to let from year to year, the probable average annual costs of repairs, insurance and other expenses (if any) necessary to maintain the hereditament in its actual state, and all rates, taxes or public charges (if any), being paid by the tenant”.
The Northern Ireland Lands Tribunal when considering the Nutts Corner Market (VR/64/1977) fixed its Net Annual Value by reference to the rental value of similar adjacent land in alternative use adjusting for characteristics of the subject land which favoured its use for a market. It is worth noting that in its judgement the Tribunal stated “it is necessary to say that no assistance was derived from the evidence regarding rentals, assessments, tolls or stall fees for other markets some of which were purpose built or covered and most were local authority markets in town centres. The state and circumstances of these markets was too different to allow any useful comparison to be made". The "profits method" was rejected by the Tribunal in favour of evidence of actual lettings of other (airport) land.
Valuation approach for 2023
The Comparative method of valuation is to be retained as the approach for this type of hereditament.
Generally, it will be the market operator who will be held to be in rateable occupation rather than the individual stallholders whose occupation would often be too transient to be considered rateable. There may be occasions where separate assessments for individual stalls would be appropriate. Typically, this might involve the conversion of an obsolete large shop into an indoor market where stalls are permanently occupied and stocked. The facts on the ground require consideration on a case by case basis. A copy of the licence/ lease agreement between the landlord and market trader should be obtained.
Brooks (VO) .v. Greggs PLC & Others 1991 considered the assessment of the Arndale Centre Market in Manchester and held that the stallholder was in rateable occupation of the market stall. The evidence showed that the stallholder had a more than transitory occupation of the market stall.
The Practice Note author, in consultation with relevant district staff, will apply the values derived from the warehouse or yard analysis (or both) to arrive at NAV.
Rent and Lease Questionnaire
For this class of property Rent and Lease Questionnaires (RALQs) were issued centrally by LPS and analysed by the Practice Note author.
Contacts
For advice on any aspect of this Practice Note contact LPS on 0300 200 7801.