HS2 & Compulsory Purchase Orders
The roll out of HS2 has been nothing if not controversial. With the deadline and budget stretching further and further away (the Independent recently reported that it would cost £403m for every mile of the new line) the creation and implementation of the new railway is viewed by many as an exorbitant drain of money and resources on the taxpayer, a killer of precious wildlife, and a source of great disruption to the lives of thousands of homeowners and businesses who will face a compulsory purchase order as a result.
But there must be a good reason why HS2 was given the green light in the first place, and there are, undoubtedly, many potential benefits to be had. As it set out to do, it will provide a crucial link between the South and the North of England, benefiting the ‘Northern Powerhouse’ and cutting the journey time between London and Manchester, and Birmingham and Leeds down by an hour.
It is estimated that that the new line will ease overcrowding on commuter routes, reduce the number of lorries on the road, transfer 4.5 million journeys a year from the air and up to 9 million from the road, a green initiative that nobody can argue with (except, of course, Donald Trump and his climate change denial crew). There is also the creation of 100,000 plus UK jobs to shout home about, as well as the ‘significant boost to the economy’ the line is expected to deliver.
However, whatever your own views are on HS2, it cannot be denied that being forced to move out of your home, or having to relocate or ‘extinguish’ your business can be a heart-breaking, difficult and unpleasant process (no matter the level of compensation received).
Following the Royal Assent of the High Speed Rail (London – West Midlands) hybrid Bill early last year, the government has been granted compulsory purchase powers for the construction of HS2 Phase 1. Royal Assent for Phase 2A (Crewe and Manchester) and Phase 2B (West Midlands and Leeds) will follow over the next few years. These compulsory purchase powers mean homeowners and business owners are forced out of their properties and land which will be purchased by the government or representative public body for their market value. All costs attributed to moving (estate agency & legal fees etc.) as well as disturbance compensation, and in the case of businesses loss of profits, depreciation in the value of stock and adaptations to replacement premises etc. will also be covered by the purchasing body.
As a business owner, when a relocation of your business proves impossible, or you meet other criteria to take compensation for extinguishment basis (here’s a link to the relevant government guide: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/571450/booklet2.pdf), compensation will be provided for the value of the business goodwill, any losses on a forced sale of stock, vehicles and plant & machinery, redundancy costs and the administrative costs of winding up the business, as well as any other reasonable costs or losses incurred, such as surveyor’s fees.
Marriott & Co. are RICS registered, independent and experienced Valuers and Auctioneers. We are therefore qualified to provide clients with compulsory purchase order plant & machinery valuations that they can rely on when submitting their compensation claims. Our Valuers prepare their valuations in accordance with the RICS Red Book, so our clients can be assured of the ‘gold’ standard required by our professional body and be confident that our reports will stand up to any scrutiny from the relevant authorities. We can also provide valuations of your business’s goodwill for compulsory purchase order purposes.
Our excellent disposal team can also sell your plant & machinery assets, in very short order if required, to achieve the highest possible realisation for business extinguishment purposes. Recently our team at Marriott & Co. were instructed to value and sell the business assets from the well-known White Rose Laundries in North Acton, as part of its compensation claim, the business having been which had been handed an HS2 compulsory purchase order. We were subsequently instructed to sell the business assets in short order with a sale of the assets in early December 2017, and completed the disposals in time for the HS2 Contractors to close the road, with chance of extension, on Wednesday 10 January 2018.
The Marriott & Co. team performed excellently within the tight timescale, lotting up the assets, creating the auction catalogue and marketing the sale by Wednesday 13 December 2017, leaving a week for bidding, further marketing and the opportunity for viewing from interested parties (all while the business was still trading). Despite being close to the Christmas holidays, Marriott & Co.’s disposal team achieved a terrific realisation for the assets in the online auction, meeting and exceeding reserves in a great result for our client. But of course, work didn’t stop there for the disposal team who worked before, after and over the Christmas period, collecting and chasing payments, arranging appointments to collect, and overseeing the collection of the considerable commercial laundry equipment and associated plant (no mean feat!) by the absolute deadline of Tuesday 9 January 2018.
We understand that businesses facing compulsory purchase, are often undergoing a turbulent and stressful time and we strive most of all to make the process of valuing and selling your business assets and plant and machinery as smooth as possible. Our Valuation & Disposal teams can be relied upon to act with the utmost integrity, discretion and professionalism. If you require some advice on a compulsory purchase order on your business or think you might require our services in this matter and would like a no obligation quote, please do call the office today on 01252 712 083.
By Frances Smithson BA (Hons)
(Opinions expressed in this blog are the author’s personal views)