Rents now halved but Newport is still losing shops
A FACEBOOK post about property tax in Newport city centre attracted more than 1,000 likes and sparked a fierce debate. DAVID DEANS investigates the issue of rent and rates in the city centre.
A DEBATE about the state of the city centre, rents and business rates sparked 1,000 likes and more than 200 comments on Facebook last week.
But one city property expert says private landlords are struggling to get major retailers into the shopping district despite rents halving over the last six years.
Some rents in Commercial Street have fallen from £160 per square foot in 2006 to £60 now.
Meanwhile, an independent city trader said he was put off a High Street-facing store because of the rates he would have had to pay.
Last week the Argus reported that four more shops were leaving the city centre, with Marks and Spencer shutting its city centre doors for the last time.
David Jones, of Hutchings & Thomas Chartered Surveyors, said rents in Cardiff can be quadruple those of Newport, with good incentives offered to retailers such as offering 12 months’ rent free if a retailer signs up to a five- year deal, or cash help to fit out a shop.
But with work yet to start on the Friars Walk redevelopment, major chains are reluctant to head into the city centre.
“The biggest issue is that there’s no appetite from any national retailer to come into the city centre,“ the surveyor said, and said lower rent was a UK trend and not just a Newport phenomenon.
Darran Ward, of Freestyle skate shop, says he pays £2,500 a year in rates for his Newport Arcade base. The firm has recently expanded to a store in Cwmbran.
Not long ago the firm had moved from a smaller unit to a larger one in the arcade. It had considered a unit fronting High Street where the landlord had been willing to do a deal.
But Mr Ward was put off when he discovered that the rateable value of the unit – formerly occupied by the BBC – was £36,000 – with rates working out around £15,000 a year.
“The stretch of shops that have been shut down, who is going to go in those? Nobody, because of the rates,” he said.
He said he was sure that the charity shops that had come into the centre had done so because of the relief they get on rates – they are entitled to an 80 per cent reduction.
Mr Ward says the shop, which has long been a haven for Gwent’s skaters, is still going well in Newport.
He said: “We’re lucky we’re a destination shop and we have a lot of loyal customers.
Until they stop using us we are going to stay open.”
However, he said, they rarely get new customers in the city centre store – in contrast to their outlet in Cwmbran, where they see new people all the time.
He said rent in Cwmbran is more expensive “but you can see where your money goes”, with the quality of the centre, the fact there are few empty shops there, “and the fact no-one is talking about when they are going to move out all the time”.
Dean Beddis, of Kriminal Records in Newport Market, says he believes his rates cost him £5 to £6 a week, due to the fact he has a small business with a small premises.
But he points out that traders in the market face other difficulties with buses in High Street stopped and the Cambrian car park closed, while the main entrance has been shut for redevelopment work.
“My rent is not a bad rent, if they didn’t dig up the main street, close the car park and stop the buses,” he said.
“To establish a new small business in these economic times needs to be encouraged.” Jon Powell, who owns the Kiosk business in High Street, says he gets small business rate relief and had to pay around £1.50 last year, and says he pays a “fair” rent.
But he said even if he paid nothing in rent it wouldn’t help him very much, with his business struggling following the loss of the trade from the car park and the buses in High Street.
“I’m currently living off the goodwill of my suppliers,” he said, saying he would have days when he wouldn’t see anyone at all.
Mr Powell hopes that trade will pick up again when the market redevelopment is complete and says he will try to hold on, although he says he has spent his savings since the beginning of works in High Street.
Tony Turner, of AD Turner and Sons in the market, said trading conditions in the market were very difficult, but he couldn’t say he was unfairly charged.
“The landlords set a fair rent and we don’t have much to argue,” he said, adding that if customers fell away paying the rent would become more difficult.
A Newport council spokeswoman said: “We meet regularly with Welsh Government to champion Newport’s cause and work closely with businesses, private- sector property owners and the chamber of tradeon behalf of the city,” she said.
“The regeneration of the city centre is very much in progress – improvements to High Street, Commercial Street, work on the market is under way and a new bus terminus is under construction.
“The new Friars Walk scheme is also progressing, with high-profile businesses already signed up and the new Cambrian development will house leading Welsh company Admiral.”
UNLIKE council tax, the business rates tax paid on non-domestic properties is not set by the councils that collect them.
They’re instead set by the Welsh Government through a process where the rateable value of a property is multiplied by the current financial year’s ‘multiplier’.
This shows the pence in the pound that firms will pay in rates, is set by the Welsh Government, which increases it every year at the rate of inflation. It is currently 0.452.
All the rates are collected and paid into a single pool, which is then paid back out by the Welsh Government to local authorities as part of their annual round of funding. The Valuation Office Agency sets the rateable value, based on the size of a property, its condition and location.
Various forms of rate relief are available. Small businesses with a rateable value of below £18,000 can claim small business rate relief, and firms with a property that has a rateable value of below £6,000 will pay no rates.
Facebook post sparks big debate but some remarks ‘discredit city’
THE topic of the city centre is on many people’s lips in Newport – and people have taken to social media to air their frustrations.
Vikky Howells posted to Newport council’s Facebook page, asking what the council was doing for independent business owners.
The story went viral, sparked a debate about the city centre and gained more than 1,100 likes and 265 comments.
However, some of the comments were abusive and the council pronounced the discussion an “unproductive rant” that reflects badly on the city.
Ms Howells took to the site on January 13 to write about a toy shop owner in Newport who, she claimed, said his rates had gone up £20,000 three weeks before Christmas.
She said he was moving to Cardiff because it was cheaper to rent a shop there.
Ms Howells wrote: “With Newport in serious trouble at the moment, why are the council doing this to independent business owners?”
Ms Howells, who ran as a Conservative candidate for the Newport council ward of St Julians in the May 2012 elections, is herself a director of recruitment agency PLS, which is set to move into the city centre from its current office in Pill.
She told the Argus that Newport city centre is a “dying place” and wondered if Debenhams would want to come to the city centre if there were no shops there.
“Me like a lot of people would like to see something change,” she said. “The reaction has been great and showed a lot of people careabout Newport.”
One commenter on Ms Howells’ Facebook post wrote that she never goes into town now “as I know I cannot ever get what I need there. I go to Cwmbran where there are shops aplenty and free parking.”
Aron Truman said: “I’ve been to smaller towns with far far less population than Newport but they manage to keep businesses running.”
Not all the comments were as polite, however, with some posters making claims about immigration and others swearing. Newport council said the post that originated the debate posed a genuine and fair query.
“However, it has descended into an unproductive rant – such negativity won’t help the city and in itself reflects badly on Newport,” the spokeswoman said.
She said while the council values its residents’ opinions, “we all need to work together” to ensure a positive future for the city.