Pub 2610 p11 news 21/10/09 17:57 Page 11
www.thepublican.com thePublican Monday 26/10/09 11
News This Week
RICS is pledging ‘greater transparency’ in
reponse to tenants complaining they do not
have enough information to negotiate rents
Royal Insitution of Chartered Surveyors vows to make rent reviews more
transparent with new code of practice for landlords and tenants
RENTS UNDER REVIEW
By James Wilmore mean “the tied tenant being no worse valuation guidance is interpreted will pubcos – and has vowed to make new
jamesw@thepublican.com off than the non-tied tenant”. look at the idea of the “reasonably appointments to its valuation group to
The RICS’ review was set up efficient operator”. ensure tenants feel they have a
PUBCO LICENSEES are being prom- following criticisms of the group in In its report RICS admitted there “greater voice given the current state
ised “greater transparency” on how the MP-led Business and Enterprise was “confusion” in the way its guid- of the industry”. But the group
rents are set and access to a central committee (BEC) report in May. ance on pub rents is interpreted. It concluded that the calculation of Fair
database of trading information to David Batchelor, senior director of also acknowledged there was a Maintainable Trade was “still the most
make rent reviews “less adversarial”. leisure and alternative investment at “perception of bias” towards the reliable” method for setting rents. ■
The Royal Institution of Chartered property advisers CB Richard Ellis,
Surveyors (RICS) has made the who helped with the review, said:
pledges following a wide-ranging “Rightly or wrongly, many tenants feel Reaction to RICS
review of how pub rents are set and they just do not have good information
the rent review system works. to robustly negotiate rents. Campaign group Fair Pint seized on the line in the review that said that a
The group has vowed to draw up a “If major pubcos pool data such as correct interpretation of RICS guidance should mean the tied tenant is no
new code of practice for landlords barrelage, lettings, margin and tenant worse off than a free-of-tie tenant. Karl Harrison, a spokesman for Fair Pint,
and tenants covering rent reviews and support in a way that clearly shows said: “It now appears that RICS, and a leading property lawyer, agree with the
lease renewals and is seeking “cross- interested parties live local data, hope- Fair Pint campaign that a rent review should leave the tied tenant no worse
industry” support. fully the market can find its own off financially than the non-tied tenant.”
And it clarified that a “correct inter- level.” But Martin Rawlings of the BBPA (pictured) said the “benefits” of being tied
pretation” of its own guidance should RICS also said a review of how its should be taken into account. “We look to the guidance to take into account all
the factors that make such an assessment, which include the benefits that
accrue from the tie, including such factors as risk, support, capital investment
The new code of practice and so forth that make such a comparison feasible,” he said.
Other trade groups welcomed the report. Nick Bish, chief executive of the
• Rules for a rent analysis would need to be drawn up when a lease begins, Association of Licensed Multiple Retailers, said: “RICS has hit
stating the basis of the calculation, explicitly using the profits method of the nail on the head. This is exactly the clear strategic direction
valuation. This would include items that will be rentalised and deal with the which ALMR and the newly formed Independent Pub
contentious area of tenants’ improvements. Confederation have been calling for, and mirrors the recently
• The initial rent analysis would form the basis of the landlord’s rent demand published manifesto.”
at review. The analysis should also form the template for a profits CAMRA’s chief executive Mike Benner said: “We are
calculation at subsequent rent reviews. delighted that RICS intends to take the lead in establishing
• Landlords would be required to present tenants with a description of the a meaningful code of practice on rents, a database of
minimum information to accompany a rent review notice. trading information and a campaign to highlight the
• Best practice would be recommended for landlords and tenants in seeking importance to licensees of seeking professional advice
the advice of a chartered surveyor to establish a tone of comparable rents. before agreeing to any rental proposal.”
Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60  |  Page 61  |  Page 62  |  Page 63  |  Page 64  |  Page 65  |  Page 66  |  Page 67  |  Page 68  |  Page 69  |  Page 70  |  Page 71  |  Page 72