Landlords win legal battle over Game

Game, the computer game retailer, will have to pay £3m to a collection of Britain’s landlords after it lost a landmark legal case about unpaid rent. The ruling by the Court of Appeal closes a legal loophole that meant companies could avoid paying rent for three months if administrators were appointed shortly after the quarterly rent day. The case came to court after a consortium of property companies including Hammerson, British Land and Land Securities claimed they missed out on millions of pounds in rent when Game called in administrators in March 2012. Hammerson said the judgement “provides a workable, common sense resolution” for future administrations. Duncan Grubb, head of credit control at Hammerson, said: “Corporate restructuring will now be focused purely on trading patterns and the viability of the ongoing business, rather than on rent free periods from landlords provided by a legal loophole.” The Daily Telegraph, Business, Page: 4 Financial Times, Page: 18 The Times, Page: 41 The Independent, Page: 54 Independent I, Page: 43 Yorkshire Post, Page: 3

Office costs not discussed in the boardroom

UK firms spend more than £28bn on offices every year, including rent, rates and furniture, according to a new report from the British Council for Offices. Despite the high level of spending revealed in a survey of 250 senior executives, more than half said property issues were not regularly discussed in boardrooms. The Press and Journal, Page: 40

Construction sector likely to be hit by bad weather

Activity in Britain’s construction sector is likely to have been affected by the worst flooding in 60 years, a member of the Bank of England’s rate-setting Monetary Policy Committee has warned.Ian McCafferty said that while the construction sector had staged a revival recently after being devastated in the global downturn, it might be a “less positive” contributor to growth in the first three months of this year. He said there may be a short-term impact on some aspects of construction, adding that he was not yet sure if it would change the overall growth rate for the first quarter.

Landlords take Game to court

Landlords, including Intu Properties and British Land, have started a legal battle with Game over unpaid rent at the Court of Appeal with experts warning that the test case could lead to many fresh claims. Landlords are seeking missed rental payments for the first three months after the video games seller called in administrators in March 2012. The landlords argue that insolvency laws — which allow the appointment of administrators a day after the “quarter rent” is due — mean that retailers benefit from a period of rent-free trading at the landlords’ expense. A week later OpCapita led a deal to buy it and acquired about half its stores. It began paying rent on these stores in June 2012. It is understood the amount of unpaid rent in question is about £3m

Leaseholders at risk of unaffordable flood insurance

According to the property industry thousands of leasehold properties face being left without affordable insurance due to the fact that they will be excluded from a new national flood subsidy scheme. The British Property Federation and the Leasehold Knowledge Partnership estimate that 70,000 leasehold properties are at high risk of flooding. The Federation's director of policy, Ian Fletcher, accused the insurance industry of making "misleading" claims about leasehold properties' inclusion in the Flood Re scheme. Meanwhile, the Telegraph reports that wealthy homeowners have been warned that they will not be covered by the new flood insurance scheme for high-risk properties even though they will have to pay a levy for it. Under the proposals, which are due to come into force in 2015, properties in council tax Band H will not be eligible for the cheaper cover because they are deemed able to pay for insurance themselves. Financial Times (Web) The Guardian, Page: 7 The Daily Telegraph, Page: 2

Rental predictions

Knight Frank has been tracking the rental market across London, Bristol, Birmingham, Leeds, Manchester and Glasgow and estimates the 2018 figure will be 5.3m. "The rental revolution is here," said Gráinne Gilmore, head of UK Residential Research. "The private rented sector is set to continue growing in the years to come, boosted not only by the difficulties many face in climbing onto the housing ladder, but also the need for flexible tenure among workers increasingly concentrated in key cities around the UK. Investors keen to tap into the market are starting to move their attention beyond London to the regions where, as our index shows, yields are higher," she adds. The Independent, Page: 46

Reduction in CGT relief to raise £360m

Landlords who let their former homes could have to pay thousands of pounds more in tax when they sell these properties after April 5, following a reduction in CGT relief. The reduction, announced in George Osborne's most recent Autumn Statement, is forecast to raise an extra £360m in tax for the public coffers over the next five years. Tim Norkett of Crowe Clark Whitehill, commented: "It's very significant. There are big profits to be taxed." Separately, the Conservative Party in Wales has promised to scrap stamp duty of houses worth less than £250,000 if it wins power in the Welsh Assembly. The move would save buyers up to £2,500.

Evening Standard, Homes & Property, Page: 6   The Times, Page: 4

Construction index hits post-crunch peak

The Markit/CIPS Construction Purchasing Managers’ Index moved up 64.6 in January from 623.1 in December, marking well above average growth in the sector and the highest it has moved since August 2007. The data was roughly consistent with housebuilding growing by about 4,000 a month, or at an annualised rate of 48,000. David Noble, CEO at the CIPS, said “The construction industry has started 2014 in formidable fashion, enjoying its strongest growth in six-and-a-half years reinforced by a sharp rise in new business orders”.

The Daily Telegraph, Business, Page: 3    Financial Times   The Times, Page: 36   Daily Mail, Page: 65     The Guardian, Page: 24

Special court for planning disputes

Chris Grayling, the Justice Secretary, has announced that disputes over big construction projects, from shopping centres to schools, will be fast-tracked through a new planning court under plans to curb costly legal challenges. An estimated 400 planning cases will go before specialist judges working to fixed time limits as part of a move by ministers to stop "meritless" challenges that clog up courts and delay or scupper building schemes. The Times, Page: 1 The Daily Telegraph, Page: 2