Exclusive: Huge rates hike for logistics warehouses as Amazon bill to rise more than £1m
Occupiers of logistic warehouses are braced for a dramatic rates hike, data shared exclusively with CityA.M. has revealed.
With e-commerce firms desperate to grab space, rents in the industrial and logistics sector have shot up.
Rental growth means will see average increases of 18.7 per cent across the board on business rates payable from April 2023, according to a forecast by Colliers.
Rates in the capital city are set to rise on average by 50.2 per cent following the next revaluation, with the South West of England seeing rises of 32.5 per cent and the South East 30.6 per cent.
A unit in London, with a current rateable value (RV) of around £500,000 will find its rates bill rise from £266,000 a year to £399,630 a year, following the revaluation.
Colliers estimated that Amazon’s biggest distribution centre in Tilbury, which currently pays an annual rates bill of around £3.625m will see its annual bill rise to £4.745m. This represents an increase of 30 per cent.
John Webber, head of business rates at Colliers, said: “For those occupying a large number of properties in the sector, such as Amazon or even retailers such as Next or John Lewis, these rises will mount up, particularly for operators who have prime sites in London and the South East and those in the South West. This will have a significant impact on their overheads from 2023 onwards.
“We are advising our clients to fully understand the likely impact of the 2023 business rates revaluation and to prepare now to avoid any unexpected cost increases.”