Proposed changes to Non-Domestic Rates in Scotland – What does this mean for the student accommodation sector?
An amendment has been tabled by the Labour Party at the Stage 2 Reading of the Non-Domestic Rates (Scotland) Bill that could change how purpose-built student accommodation (PBSA) is taxed in Scotland.
There is potential for this to materially impact operating costs of PBSA and consequently value. Talk of this bill raising £18 – £19 million through Scottish PBSA suggests a new charge of between £500 – £600 per bed per annum, not dissimilar to the circumstances in Belfast. This could have a material impact on valuation (reductions of £10k per bed) or if passed on to students, could see rent rises by over £10 – £15 per week.
“The application of non-domestic rates to private PBSA in Scotland is likely to have a material impact on investment in new schemes in Glasgow, Edinburgh and elsewhere and result in significant rent rises for students. The potential for unintended consequences to Scotland’s world class education system deserves a more considered and joined up approach from its politicians.”
David Tymms – Chair, BPF Student Accommodation Committee …