Key Insights and Opportunities from the Aitchison Raffety Team
As we move through Spring, we see the property market evolving, shaped by economic trends, shifting buyer priorities, and regulatory changes. In this update, we explore key developments, from investment opportunities to emerging challenges, helping you stay ahead in a changing landscape. Our expert team share their insights to support you in making confident, well-informed decisions for your business.
Planning and Development
It has been a busy first quarter for 2025 in the world of Planning. Following hard on the heels of the new National Planning Policy Framework (NNPF), February saw the publication of the Government’s updated guidance on the Green Belt, and this was followed by the publication of the Planning and Infrastructure Bill (PIB) in March.
Local planning authorities are now required to assess their Green Belt areas as part of the plan-making process, and to consider planning applications on Green Land, and the guidance indicates that this will need to be at a suitably granular level. These assessments may identify so-called “grey belt land” – land which has been previously developed, or which does not make a strong contribution to some of the defined purposes of the green belt. While such grey belt land will not automatically be allocated for development (there must, for instance, be a “need” for the development) – this should create opportunities to release development potential in certain locations, in particular lower order settlements, given that the guidance emphasises that the Green Belt purposes relate, for example, to preventing the sprawl of towns, not villages.
There is a lot to digest in the PIB, and much of the detail is reserved for secondary legislation. Amongst the headlines are the reintroduction of strategic planning in England, a greater prioritisation of green energy projects and – most controversially – an intention to set out a national scheme of delegation. This scheme will set out which applications should be dealt with by planning officers, and which should be dealt with by committee, with the aim being to reduce the latter. This will be welcomed by many, particularly advocates for development (though some may criticise a loss of local democracy) and should help to speed up the decision-making process, add greater certainty and reduce the number of applications reaching appeal. Watch this space!
Duncan Thomas, Head of Planning and Development
Valuation
We have been supporting clients with queries around the Leasehold & Freehold Reform Act (LFRA), which received royal assent in May 2024. The Act represents a significant shift in property ownership laws in England and Wales, aiming to empower leaseholders and promote fairness in the housing market.
A summary of the main provisions of the Act include:
- Simplified Lease Extensions and Freehold Purchases: The Act removes the previous two-year ownership requirement, allowing leaseholders to extend their leases or purchase the freehold immediately upon acquiring the property. Additionally, it abolishes ‘marriage value’ – a charge that often made these transactions costly – making the process more affordable.
- Extended Lease Terms: Leaseholders can now extend their leases up to 990 years, a substantial increase from the previous 90 years for flats and 50 years for houses.
- Ban on New Leasehold Houses: The Act prohibits the sale of new leasehold houses, except in specific circumstances.
- Right to Manage: More leaseholders, especially those in mixed-use buildings, can now exercise their right to manage their properties.
- Transparency and Fairness: The Act introduces greater transparency over service charges and makes it easier for leaseholders to challenge unreasonable charges at tribunals.
These reforms are expected to have a notable impact on property values:
- Increased Property Values: Properties with extended lease terms and the potential for freehold acquisition become more attractive to buyers.
- Market Confidence: By reducing complexities and costs associated with lease extensions and freehold purchases, the Act fosters greater confidence among buyers and investors.
- Two-Tier Market Risk: There is a concern that the Act might inadvertently create a two-tier market. New properties under commonhold arrangements could be more appealing, while existing leasehold properties, especially those with shorter leases, might become less desirable unless leaseholders take proactive steps to extend their leases or purchase the freehold.
If you would like to discuss how the Act may impact your property, please contact our Valuation team who would be happy to assist.
Michelle Campbell, Head of Valuation
Business Rates
As we begin the new financial year the business rates team has been busy advising clients on their 2025/2026 rates bills, which have now been issued by councils. Clients are experiencing increased rates liabilities on several fronts.
- Retail Hospitality and Leisure Relief: This has been reduced from 75% to 40% in 2025/26 resulting in substantially increased bills for our clients in this sector.
- Standard Multiplier: Rateable values above £51,000 have seen the multiplier increase from 54.6 pence in the pound, to 55.5p, again resulting in increased bills for most of our clients.
Given the increased costs businesses are facing, many clients are looking to Aitchison Raffety to try and reduce their tax burden, and we have delivered, reducing clients’ rateable values by a total of over £1.9m in the last quarter alone.
Empty property remains a focus for our business rates team, taking numerous new instructions from occupiers and landlords who have property, which is either earmarked for refurbishment, or simply sat waiting to be let. There are normally business rates savings which can be achieved on empty properties, so it is always recommended to seek advice if you have space which is not being used.
With only a year remaining to lodge appeals against the 2023 rating list, our focus remains on ensuring we have reviewed all our clients’ rateable values before the list closes, to make sure no stone is left unturned. Given this timeframe it is critical that occupiers look at reviewing their business rates sooner rather than later. After 1st April 2026 you lose the right to appeal, so any overpayment for the years 2023-2026 will be lost!
We also have one eye on the 2026 revaluation, which goes live on 1st April 2026. The Valuation Office Agency (VOA) publish a ‘draft list’ in November 2025, and it is often possible to reduce the VOAs new rateable value before it even goes live. In preparation for this, we are already being instructed to act by clients on the next rating list, and ensuring we have all the necessary information to attack the draft list as soon as it is published.
If you have queries about your 2025/26 rates bill, have an empty property, or want more information on how the 2026 revaluation might affect you, our business rates team would be more than happy to help.
Joe McCarthy, Head of Business Rates
Investment market
The last quarter from December 2024 to March 2025 has been a quiet one for investments. Many commentators were unsure as to where interest rates would end up, and there was still uncertainty over the economy in general and for the office market regarding returning to work. The Chancellor’s increases in National Insurance contributions and the minimum wage announced last year were expected to have quite an effect on the Food and Beverage (F&B) sector, with some retailers employing large numbers of staff seeing some significant rises in their wage bills compared to their profit margins. Morrisons have recently announced the closure of 52 stores. All this has an effect on the prospects for retailers staying in business, especially in the F&B investment sector. The Chancellor’s recent Spring Statement also suggests lower growth than expected and higher inflation, but with figures returning to the forecast by 2027. This may well have a further effect on investor sentiment.
However, at recent auctions in March there appears to have been a flurry of bidding up from investors, possibly with a feeling that rates are likely to remain largely unchanged and so investors can have some certainty even in this uncertain world.
Hertfordshire Commercial Agency
Industrial demand is slightly down on the last 12 months for larger units over 50,000 sq.ft but at the smaller end of the market there is still good demand. The first letting at the new Prologis Park in Hemel Hempstead has been confirmed, with rents being quoted at £22.50 psf. There is also strong interest at present for leisure uses such as Padel tennis and Pickleball, although mainly in high population urban areas.
Rental levels for prime industrial in Watford are now in the region of £24-25 psf for brand new space, whilst Uxbridge quoting rents are at circa £26 psf.
The office market is still slowly recovering, with strong interest and offers in discussion for the 55,000 sq.ft Jubilee Square office development in St Albans. There is a definite flight to high quality Excellent EPC rated buildings, with rents being quoted at £42.50 psf in St Albans and £40 psf in Watford. Hemel Hempstead still represents good value in comparison, with top rents being quoted at £32 psf.
The retail market is still strong in most towns across the Southeast, especially for shops under around £30,000 p.a. We are beginning to see a shortage of retail units in the majority of towns.
To view our available properties, use our property search.
Ian Archer, Director, Commercial Agency
London Commercial Real Estate
The first quarter of 2025 in London has been a busy one. For months, businesses have been preparing for the April tax rises, which have been cited as a key factor in lease renewals and rent reviews across the retail and leisure sectors.
With increases in Stamp Duty Land Tax (SDLT), reduction in Rate relief, and higher National Insurance and Inheritance Tax liabilities, there has been a surge of advisory work for our SIPP and SSAS clients resulting in new disposal instructions.
The industrial sector stands out across London and the Home Counties for activity and growth, with good levels of sales, lease renewals and development appraisals activity.
We have also been working with clients on residential development opportunities, particularly permitted development, where we work with our Planning and Development colleagues to advise clients on their bids.
If you’re interested in finding more about Permitted Development opportunities, we’d love to hear from you.
Gerard Barry, Head of Transactional and Capital Markets
Primary Healthcare Market
Rental growth in the primary healthcare market has been consistent nationwide, though the process of progressing rent reviews and Notional Rent appeals remains slow. This is largely due to understaffed Integrated Care Boards (ICBs) and District Valuer’s offices, which handle assessments, and subsequent negotiations. Growth continues to be seen on properties of all ages and specifications, with higher levels being consistent with more modern high specification premises, as opposed to older converted premises. More reviews than ever before are going through Local Dispute Resolution Procedures (LDRP) and in some cases beyond this stage to NHS Resolution.
At lease renewal, ICBs are often reluctant to approve longer lease terms of 15 to 20 years without capital expenditure and modernisation of premises to bring them in line with latest NHS Guidance. These can range from minor upgrades to more substantial improvement works and extensions, with grant funding available in some cases. Investor preference remains a minimum of 15 years, and this can be achieved without break clauses but can take some time to secure.
The newly released NHS Directions 2024 provide additional Guidance on funding and abatements, including assistance with land acquisition costs. There are also stricter timescales for acceptance of rent assessments and the procedures relating to rent review processes put more onus on Tenant involvement at an early stage. Interpretations of the requirements of this Guidance vary between ICBs, however they are starting to become more aligned in their thinking an application of the Directions.
Investor confidence in the primary healthcare market is starting to improve, with transaction levels starting to pick up after a prolonged slowdown. While values have adjusted from their 2021 peak, the sector remains resilient, underpinned by strong demand and NHS-backed income. As we move further into 2025, we expect to see increased sales activity
Paula Mace, Head of Healthcare
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