Empty Property Schemes

An Empty Property Scheme can support activity in under-used parts of your town centre in the short-term, while providing a pipeline of potential new business tenants in the longer-term.

The London New Enterprise scheme, launched by the Mayor of London, is an online portal for new businesses to find space and favourable terms in London. It's a really interesting model that could easily be replicated in your local area; why not talk to local estate agents (or even the owners if you can track them down) and bring them into your partnership? All it takes is one forward-thinking agent/landlord and others will follow.

In areas where vacancy rates are high property owners will suffer a double hit, paying rates on empty properties from which they are getting no rental income, plus a potential fall in the value of vacant units due to the surrounding environment. As a result many property owners are offering reduced or even free rent on vacant units for a limited period. When this time frame elapses, tenants are given the first refusal of leasing the unit at full or closer to market rate.

The property owner or landlord gains because the rates and utilities are paid for by the tenant, and an occupied property is more secure than an empty one. In addition the tenant will be responsible for looking after the building and may well improve it. An occupied property is also easier to market than an empty one. Due to the temporary nature of the short tenancy contract the discount or ‘inducement’ means there is no fall in the book value of the property.

During the short-term tenancy, the new enterprise will have time to develop and test their business proposition with a lower cost base providing it with a much better chance of long-term survival.