The 2017 Rating Revaluation has proven to be very interesting for a number of specialist sectors, due to significant changes in the market over the past 7 years, since the last Revaluation.
Birmingham’s visitor economy attracted a record 39.1 million visitors in 2016, which translated into a record £6.5 billion income for the region.
The city’s hotels, not surprisingly, also achieved a record year with average occupancy, average room rates and average revenue per available room (RevPAR) all exceeding previous records.
Despite such a positive market environment, it is our view that the Valuation Office Agency, the Government agency responsible for undertaking Rating Revaluations, has over-inflated Birmingham hotel rateable values when they carried out the 2017 Rating Revaluation.
The revised rateable values, which became operative from 1 April 2017, did not, in our view, reflect the significant hotel openings in the locality between 2015 and 2017, such as the 253 room Park Regis Hotel at Five ways Birmingham, or the increased competition provided by operators such as Airbnb.
The impact of a number of openings in the city, and a greater amount of accommodation becoming available, has resulted in an over-supply in the market, making pricing more competitive, which needs to be reflected in rating assessments.
Each assessment needs to be looked at in detail to ascertain whether it is fair and correct, and it is our view that the Valuation Office Agency does not always possess the full facts to enable them to provide a fair opinion of value.
Part of this is due to significant reduction in investment, a reduction in staff numbers and office closures within this division of HMRC; an ongoing issue. However, ratepayers do have the opportunity to appeal their assessments.
Colliers International acts for numerous hospitality clients including both national companies and regional operators. We have a specialist hotel team which would be pleased to assist if you have concerns regarding your Business Rates.