Value of non-domestic commercial market falls £77m year on year

Value of non-domestic commercial market falls £77m year on year

Market analysis by debt advisory specialists, Sirius Property Finance, has found that while the volume of non-domestic rateable properties in England has crept up over the last year, there has been a marginal decline in their total rateable value. 

Sirius Property Finance analysed data on non-domestic properties – those not used for living accommodations such as shops, offices and warehouses – looking at the rateable value of this commercial real estate in current market conditions. 

The rateable value is an estimate of what it could cost to rent a property for a year based on a set valuation date. 

The analysis shows that there are just over 2m non-domestic rateable properties located across England, with London home to the highest proportion (16%) with 319,300. This marks a marginal increase of 0.2% versus 2022, which may sound insignificant, but equates to an increase of 3,750 properties. 

In the current market, the rateable value estimated totals over £63.5bn, a marginal reduction of -0.1%, but again, one that equates to a drop of almost £77m. 

As a result, the average value per rateable property currently sits at £31,488 per year. 

Of the three primary non-domestic sectors, it’s the industrial sector that boasts the highest volume of commercial rateable properties (532,680), however, the retail sector sits top with a highest total rateable value of £15.9bn in 2023. 

This is despite both an annual reduction in the volume (-0.3%) and total value (-0.9%) of these properties when compared to last year.

The office sector has also seen a year on year decline in both volumes (-1%) and total rateable value (-1%).

In contrast, the number of industrial rateable properties is up 0.7% annually, with the total value of these properties also climbing by 1.1%.

Managing Director of Sirius Property Finance, Nicholas Christofi, commented: 

“Overall, the rateable value of non-domestic properties across the nation has declined marginally over the last year, despite the challenging landscape facing the commercial sector. At the same time, volumes have also crept up, which suggests an underlying air of confidence within the commercial space. 

Of course, this marginal reduction in values still equates to a notable £77 million versus last year, which really demonstrates the sheer size of the sector in England. 

While retail remains the most valuable non-domestic core sector, it’s the industrial space that has gone against the wider grain to register an uplift in both volumes and rateable value.”

Data tables

Data tables and sources can be viewed online, here.

Building, Design & Construction Magazine | The Choice of Industry Professionals 


Latest Issue

BDC 309 : Oct 2023