Local Authorities to be able to force rental auctions of vacant hospitality premises

Following recent legislation, local authorities (“LA”) can now force rental auctions of vacant premises including hospitality premises, i.e. cafes, bars, restaurants, pubs. If a premises is made subject to the rental auction process then proprietors of such premises could find themselves facing the onerous burden and costs of complying with LA requirements which may include putting EPC sub-standard and/or dilapidated property into an into an improved state of condition in time for an auction.

This is particularly poignant to proprietors of vacant hospitality premises (most notably vacant pubs) which are no longer economically viable and which they wish to re-develop for alternative use. For many proprietors this often means that the premises maybe marketed for a year or so before planning permission is obtained for the conversion putting the premises at risk of being caught by the regulations. In conjunction with the implementation of the regulations, the government has extended the categories of permitted development to assist in such circumstances but to protect against such risk, it would be advisable for the proprietor to seek to exchange an agreement for lease with a prospective tenant subject to obtaining any such planning permission before the property has been vacant for 12 months.

Find out more details about these regulations and how they could impact your food and drink premises here.

Since the introduction of the new legislation on 2 December 2024, the government has published non-statutory guidance which you can read in full here, which, although lengthy, includes a handy and colourful process flowchart worth bookmarking!