Rating Manual section 6 part 3: valuation of all property classes

Section 20: advertising rights, advertising stations and land used for advertising

This publication is intended for Valuation Officers. It may contain links to internal resources that are not available through this version.

1. Scope

This Section of the Rating Manual guidance on the valuation and approach in respect of advertising rights, stations and land used for advertising.

It should be noted that Public Service Broadcast Screens are situated in certain town centres. Although these often have some elements of sponsorship and advertisement, they are not advertising displays and are not treated as advertisements for rating purposes. See Rating Manual, Section 6: Part 3 Section 628 for further details about Public Service Broadcast Screens.

1.1 General background

Outdoor advertising displays take many different forms, from the large hoarding panels adjoining busy main roads to the smaller illuminated panels at pavement level. The market for suitable sites or contracts is very competitive, with most of the key locations for larger sites (and local authority/shopping centre contracts) controlled by a relatively small number of national companies. These companies tend to specialise in certain aspects of the outdoor advertising market. Due to the innovative and competitive nature of the outdoor advertising industry, changes of company name, takeovers and mergers are relatively frequent.

Although improvements and innovations in technology and printing methods have a constant impact on the way outdoor advertising is displayed, in the main the size of the displays continue to be referred to against a traditional benchmark based on paper posters that are of a size that can be managed by a person on a ladder: these are referred to as “sheets”; the equivalent of four of these sheets is ordinarily produced in one piece, which is described as a “4-sheet”. Larger posters displays therefore comprise a number of “4-sheets” pasted together and so a hoarding of four “4-sheets”, placed side by side, one above another, is known as a “16-sheet” and so on. The “48-sheet” is half the size of the “96-sheet” and there are examples of “192-sheet” equivalent sizes, being two “48-sheets” side by side. In more recent times, the predominant small poster format to emerge is the “6-sheet”, which is typically wall mounted, on bus shelters, or freestanding; they feature in pedestrianised precincts, superstores, shopping centres, petrol filling stations and motorway service areas. The “48-sheet” remains the predominant larger format display, although there are signs this is changing. “48 sheets” are typically displayed prominently above the street scene, for example up on an end wall, or gable-end.

Paragraph 1.4 below and Appendix 11 of the VOA Code of Measuring Practice for Rating Purposes provide the traditional sizes of format available for outdoor advertising.

Although “6-sheets” remain the dominant “small format” type of display, the same is no longer true for “48-sheets” in terms of “large format” displays. From 2015, if the trend continues, the 48-sheet is set to become just one of many types of larger format. The constant improvements in printing and technology mentioned above have enabled more bespoke sizes to emerge. These tend to be displayed in higher value or one-off locations and do not conveniently fit into the traditional pattern of “sheet sizes”. For example large “squares” are used and huge “spectaculars” can cover the sides of multi storey buildings using one specially designed banner, often tethered with rope using eyelets in the banner itself.

1.2 The organisation of poster advertising

Several parties are involved in the buying and selling of poster advertising services and there are a number of ways the transaction can be arranged. Typically an advertiser uses an advertising agency to research, create and design an appropriate campaign. When posters are to be used the advertising agency (acting on the advertiser’s behalf) generally uses an outdoor specialist to plan and book the campaign with poster contractors.

Advertising campaigns are organised in regions based on the traditional commercial television franchises, and outdoor advertising display “bundling” is similarly organised. This allows for co-ordinated campaigns on TV, radio and posters as appropriate. It remains to be seen whether this traditional manner of operating continues in the face of the change to digital formats and satellite & cable TV, all of which may have an impact of the current commercial TV boundaries.

Poster contractors own the panels on which the posters are displayed; these contractors have rights to use the sites on which posters are placed. The contractor generally does not own the site, and the site owner may receive a rent from the contractor. The poster contractors vary in size, capability and the extent of the functions they directly undertake; subcontractors can erect panels, distribute and warehouse the posters and attach the posters to the panels. The advertiser (often via the advertising agency) pays the poster contractor for the use of the panels and also pays the production costs of his poster. The advertising agency and the outdoor specialist receive their remuneration by way of a commission from the poster contractor.

1.3.1 General

London alone accounts for about 30 per cent of roadside poster panels while the South-East, being the television regions to the south east of a line from Norfolk, through Buckinghamshire to Wiltshire (and which some in the poster industry term ‘the Golden Triangle’), accounts for about 40 per cent. Formats larger than 48-sheet, bespoke formats and “spectaculars” are mostly sited in the large cities, with the majority in London; the Midlands and the North-West between them accounting for about 25 per cent.

1.3.2 A brief history of poster advertising

From the introduction of commercial television in the 1950s until the advent of the Internet, poster advertising’s share of all advertising media has been relatively constant, fluctuating at or around 5 per cent of the total.

The late 1980s marked a strong expansionary period for the poster industry. Advertising Association estimates suggest that outdoor advertising revenue grew in real terms by about a third between 1985 and 1989. In 1990 poster advertising declined by almost 5 per cent in real terms, with the roadside sector declining by almost 8 per cent but transport posters growing slightly. The number of “supersite” (or 96-sheet) panels (being the equivalent of two 48-sheets side by side) owned by members of the Outdoor Advertising Association (OAA) trebled between 1987 and 1990.

The decline in demand for poster advertising in 1990 and 1991 was only partially reflected in the decline in the number of panels, being mostly reflected in increased numbers of panels left vacant at that time. Contractors then indicated that their profitability fell, with some incurring trading loses in the short run.

By spring 1991 the number of supersites declined reflecting weaker demand for this ‘luxury’ size of panel than for posters generally during the 1990s recession. The number of 48-sheet panels owned by OAA members remained between about 19,000 and 30,000 between 1986 and 1989. In 1990 it grew by 10 per cent but declined by 5 per cent by spring 1991. The 4-sheet poster size is declining. In spring 1991 OAA members owned 47,000 roadside 4-sheet panels compared with 70,000 in 1986 (many former 4-sheet panels having been converted to 6-sheet).

Despite the recessionary period in the early 1990s, overall spend increased steadily through the 1990’s; from 1992 to 2001, the overall spend increased by 90% (around 50% in real terms) and whilst the percentage spend on all sectors remaining broadly constant over that period, notable exceptions being an increase in cinema and radio advertising spend at the expense of television advertising.

From 1997 to 2006, total spend on advertising continued to increase steadily, amounting to a 40% increase in actual terms (around 25% in real terms) over that period. Additionally, from around 2001, the Internet started to become an advertising medium to be reckoned with. By 2006, the Internet accounted for 11% of the total advertising spend, representing twice as much as outdoor advertising spend. Whilst the total spend on advertising, and the share spent on outdoor remained around the same 2001 and 2006, the main impact of the Internet was felt by reduced spending on the advertising media of newspapers & magazines, TV and direct mail.

Over the same period, for roadside posters the major growth area has been the 6-sheet panel. Another major growth area has been “supersites”, particularly 96-sheet panels, spectacular displays and bespoke formats.

From the middle of 2008 onwards, the so-called “credit crunch” had an almost immediate and significant impact on overall spend on advertising from 2009 to 2012, and whilst outdoor advertising held onto its share of this total, in real terms the spend reduced by between 16%-17.5% at its lowest point. By the end of 2014, advertising spend had recovered the ground well and despite a dip, numbers of 6-sheet displays increased slightly to 78,000; however, at 20,000 there were 20% fewer 48-sheet displays at the expense of more bespoke or special large format displays.

Advertising is an innovative environment, not only in the way that campaigns are orchestrated, but also the variety and types of media available to advertisers to get their message across. Of particular note is the development and increasing use of digital advertising displays. Although these are now very common indoors (shopping centres, the underground and covered precincts) the technological problems of competing with sunlight are being overcome, and they are set to become more common in the outdoor arena.

Evidence this is already happening is clear. Moving image displays have already replaced the “fluorescent strip lights” at Piccadilly Circus in London. Similar moving image displays can also be seen from some arterial highways and motorways in major cities.

At the “small-display” end of the spectrum, street level advertising continues do well. Similarly, in petrol filling stations, superstores and other areas where people “dwell” for a few moments, displays via video screens and poster displays are increasingly being used.

1.4 The types of posters used for outdoor advertising

1.4.1 Traditional posters

Posters used for outdoor advertisements come in various sizes with a variety of characteristics. The poster is typically attached to a structure termed a ‘panel’, and this is placed, possibly with other panels, on a poster “site”. Panels are traditionally measured in terms of 30 inch x 20 inch sheets.

Where indicated below, the total numbers of poster display panels exclude those used wholly within the transport sector (e.g. London Underground), but include all display faces (in other words a 3x 6-sheet scroller will count as 3 posters) and includes Northern Ireland and Scotland. [The numbers are based on information available at October 2015]

The main sizes of traditional posters are generally as follows:

  • 4-sheet: The smaller (1.02m x 1.52m, portrait) panels whose visual impact is suited to pedestrians; a declining format still found in certain thoroughfares and pedestrianised areas. Although there were once over 70,000 of these in Great Britain, there are fewer than 1,000 remaining

  • 6-sheet: (1.8m x 1.2m, portrait). Alternatively called “Superlites” or ‘super-sixes’ to reflect More O’Ferrall PLC’s (MOF’s) registered trade name of “Adshel Superlite”. Sited on bus shelters or freestanding, they are often backlit, to improve nighttime impact, and are usually sited to catch motorists’ vision as well as pedestrians’. There are currently over 78,000 6-sheet panels in Great Britain with many being candidates for a move to a digital ‘moving image’ format

  • 12-sheet: (3.05m x 1.52m, landscape). Since mid-1991 this size of panel has been little used for roadside posters. There were fewer than 1,000 in 2008

  • 16-sheet: (2.03m x 3.05m, portrait). A declining format. There were once over 11,000 such panels in Great Britain, but there were fewer than 600 in 2008

  • 32-sheet: (4.06m x 3.05m, landscape). Now a little used format. There were once over 2,000 of these, but statistics are no longer compiled

  • 48-sheet: (6.1m x 3.05m, landscape). Slowly in decline, this is no longer the predominant large poster size, but there are still significant numbers. It has a strong impact to both passing motorists and pedestrians. There were once more than 40,000 48-sheet poster panels in Great Britain, but this has reduced to around 25,000 in 2008 and now stands at 20,000

  • 64-sheet: (8.12m x 3.05m, landscape). A format rarely used; there are now so few no statistics are now available

  • 96-sheet: (12.2m x 3.05m, landscape). Once referred to as supersites, this format was steadily increasing in prevalence to 2008. There were about 2,500 such panels in Great Britain in 1998, this steadily increased to over 3,000 in 2008, but has now fallen back to around 2,000, possibly at the expense of more bespoke or ‘non-standard’ display types

  • 192 Sheet: (24.4m x 3.05m, landscape). Found on arterial routes where the site is suitable for such a large format. No statistics on levels of use currently available

1.4.2. “Non-standard” or “non-traditional” posters

As technological advances continue, more bespoke types and sizes of posters formats are being used.

Not only are the types of format becoming more varied and flexible, but also the numbers of non-traditional poster display sizes are increasing. Some companies have developed their own particular sizes that break the link with the “sheet” sizes mentioned in 1.4.1 above. This trend is set to continue as companies consolidate and benefit from economies of scale, allowing them to develop more bespoke formats and offer them in packages to advertisers.

1.5 Rating background

During the late 19th and early 20th century, case law highlighted the difficulties encountered with this class of property when trying to determine rateable occupation - namely what constituted “occupation” and who should be regarded as “the occupier”.

Various efforts were made to clarify the position but revisions to the statutory provisions often themselves raised fresh problems. Section 28 of the General Rate Act 1967 sought to consolidate these statutory provisions and although The General Rate Act 1967 itself is now repealed, much of the earlier terminology and provisions are still to be found in the current legislative framework.

Exploring the historic situation a little further, the use of “Advertising Station” as a heading to Section 28 of the GRA 1967 is indicative of the fact it has in fact a very broad meaning, that being land (including the right let out) used for the exhibition of advertisements. The term encompassed any hereditament considered at that time to be the equivalent of what we would describe today as “outdoor advertising”, being any right, station or land.

The term “Advertising Station” is seldom used in recent times; it has a broad application and therefore is capable of being misunderstood.

Under the heading “Advertising Station” in the GRA 1967, three states of assessment were possible:

a. Advertising right

b. Statutory advertising station

c. Site used for advertising

It can therefore be seen that, although the term “advertising station” encompasses all outdoor advertising displays, the hereditament is treated as an advertising right, statutory advertising station or site used for advertising, depending on a combination of the legal situation and the facts on the ground.

It is hoped that this brief examination of the statutory background provides a useful backdrop and the similarities between the historic situation described above and the current provision will become apparent.

Finally, it should be noted that although the historic term “advertising station” is no longer commonly used to describe outdoor advertising displays by those working in the outdoor advertising industry, it is still found in leases and “estate terriers”, being used to describe rental income from advertising stations, whether the advertising station is (legally speaking) a “right let out” or “land”. Similarly, for rating purposes, the term “advertising station” is still employed in particular instances, which will be explored later in this section.

2. List description and special category code

For advertising displays and hoardings in general, the available Special Category (SCat) Codes are:

003 (Advertising Right or Station), and

146 (Land Used for Advertising).

For 4-sheend 6-Sheet bus shelter panels and 6-sheet panels at supermarkets, Special Category Code 003 (Advertising Right or Station) should be used.

As a ‘Generalist’ Class, the appropriate suffix letter is G.

The Primary Description Code (P Desc Code) and primary description available are:

  • SCat Code 003 – Either CA (Advertising Right and Premises), or CA1 (Advertising Station and Premises)

  • SCat Code 146 – Either CX (Bespoke description required) or **CA1 (Advertising Station and Premises)

Furthermore, in the use of these codes and descriptions:

P Desc Codes of CA and CA1 have default primary descriptions and these must not be overwritten, shortened or extended,

P Desc Code CX must only be used with SCat 146 and never used in combination with SCat 003,

  • P Desc Code CX must always be overwritten with something like “Land used for Advertising and Premises”, and

  • P Desc Code CA must only be used with SCat 003 and never used in combination with SCat 146.

3. Responsible teams

Valuations made in respect of advertising hereditaments are a “Generalist” class.

Requests for Information should be made on forms of return (FOR) as appropriate; FOR VO6040 is to be used to seek the information needed to make valuations, but follow-up with VO6005 may be required to seek further and better particulars about structure costs and to see clarification as to whether the hereditament is an advertising right, statutory advertising station or land used for advertising

4. Co-ordination

The Advertising Class Co-ordination Team (CCT) has high level responsibility for the co-ordination of this class. The CCT is responsible for examining the approach to making valuations for advertising displays. The CCT will deliver Practice Notes describing the valuation basis for revaluation and provide guidance as necessary during the life of the rating lists. Caseworkers have a responsibility to:

  • follow the guidance and advice given at all times

  • not depart from the guidance given on appeals or maintenance work without approval from the CCT

  • seek advice from the CCT before starting any new work, including bringing into assessment any ‘“new” types of advertising display.

The framework for co-ordination is shown in Rating Manual Section 6 Part 1. Additionally, and where available, this class is subject to the co-ordination procedures outlined in the appropriate practice notes attached to Rating Manual section 6 part 1.

Once Rating Lists are published, levels of value in respect of advertising hereditaments is expected to become settled over time.

4.1 Changing formats and new types of outdoor advertising display

Advertising display hoardings are subject to modernisation and innovation. These may feature in Paragraph 1 above or the relevant practice note attached to this manual section, where available. In any case of doubt, and in particular where new types of advertising display have been identified, VOs should follow the standard protocols for seeking advice, and where appropriate submit full details to the Technical Adviser for advice.

5.1 Current statutory provisions

The statutes in force at the time of writing and applicable to the treatment of advertising displays are as follows:

  • Local Government Finance Act 1988 (as amended) (LGFA 1988)

  • The Non-Domestic Rating (Alteration of Lists and Appeals) (England) Regulations 2009 (SI 2009/2268)

  • The Non-Domestic Rating (Alteration of Lists and Appeals) (Wales) Regulations 2005 (SI 2005/758 W63)

  • The Non-Domestic Rating (Miscellaneous Provisions) (No. 2) Regulations 1989 (SI 1989/2303)

  • Central Rating List (England) Regulations 2005 (SI 2005/551) (as amended)

  • Central Rating List (Wales) Regulations 2005 (SI 2005/422)

As the statutory provisions relating to advertising appear in a number of different places it is hoped that the table below will provide some assistance. The full text of each excerpt is available at Appendix 1.

5.2.1.1

RM 5:20 Paragraph No:

Brief details of the area covered by the legislation:

Statutory Reference Applicable:

Advertising – Types of hereditaments

LGFA, 1988 - S. 64(1) and (2) & S. 65(8A)

Rights – separate hereditaments

LGFA, 1988 - S. 64(2) LGFA, 1988 - S. 64(11)

5.2.1.2

Rights – Coming into existence

SI 2009/2268 & SI 2005/758 W63 - Para 15(1) and (3)

5.2.1.3

Rights – Subsequent changes

SI 2009/2268 & SI 2005/758 W63 - Para 15(2) and (3)

5.2.1.4

Rights – Cessation

SI 2009/2268 & SI 2005/758 W63 - Para 15(2) and (3)

5.2.1.5

Rights – Rateable occupier

LGFA, 1988 - S. 65(8)

5.3

Stations – Land treated as occupied

LGFA, 1988 - S. 65(8A)

5.4

Advertising on rateable hereditaments

SI 1989/2303 - Para 4 (1-4)

8.2.7

Advertising and railways

SI 2005/551 & 2005/422 Part 6 and Part 7 respectively

8.2.8

Advertising and canals

SI 2005/551 & 2005/422 – Part 16 (in each case) & SI 1989/2303 - Para 4(1) and (2) respectively

The operation of the Alteration of Lists and Appeals Regulations can be located in Rating Manual section 6 part 1, and the operation of the Central List Regulations, for both England and Wales can be located in Rating Manual section 2 part 2.

5.2 The exhibition of advertisements – types of hereditaments

The LGFA 1988 and associated regulations (see Paragraph 5.1 above) determine two ways in which an advertisement can be a separate hereditament: -

(i) when a right is granted permitting the use of land for advertising, (advertising right) or,

(ii) when land is used for advertising, or for the erection of an advertising structure (advertising station or land used for advertising).

However, the second determination above encompasses advertising stations and land used for advertising. Thus, the 1967 position is broadly replicated and three states are:

1.Advertising Right: An advertising station where the right of exhibition of advertisements is “let out” or “reserved”.

2.Land used as an Advertising Station: Land used as an “advertising station” for the exhibition of advertisements where that land is not used for any other purpose and is deemed to be in the occupation of the person permitting such use or, if he is not known, the owner where the land is otherwise occupied, or,

3.Land Used for Advertising: where land used as an advertising station is being used for the exhibition of advertisements and is;

  • not subject to a right let out or reserved (Advertising Right at (1) above),

  • not in the deemed occupation of the person permitting such use (Advertising Station at (2) above), then

the assessment is made by application of the general principles of rateable occupation to that site.

it is most important to ensure that there is no confusion as to which event is being rated, as their legal provisions are quite distinct the three states are being examined in more detail below

5.2.1 Advertising rights

5.2.1.1 Separate hereditaments

A separate hereditament is created by s.64(2) Local Government Finance Act 1988 in respect of a “right” to use any land for the purpose of exhibiting advertisements and;

a.the right is let out or reserved to any person other than the occupier of the land, or

b.where the land is not occupied for any other purpose, the right is let out or reserved to any person other than the owner of the land.

The usual definition of ‘land’ is extended to include any wall or other part of a building and any sign, hoarding, frame, post or other structure erected or to be erected on land.

Although for valuation purposes the extent of the sign or structure is important, it should be remembered that the hereditament is and will remain the right originally granted.

The distinction between a “Right let out” and a “Right reserved”

To be “let out”, a right is granted to another person from (or over) land; this is the normal position when a right is created. In some instances a right is created by reservation. For such a right to be “reserved”, the grantor retains the right, whilst he lets another interest in the land. An example of a reservation would be a landlord letting a corner shop, but reserving himself the right to place advertisements on the gable end. From a legal standpoint, a “let out” or “reservation” cannot be implied or presumed; it must be expressed.

This was considered in **Peak (VO) v Henlys (Bournemouth), Ltd. (1959) LT 52 RIT 305, where an advertising sign was not separately rateable as an advertising right where it was found there was no express reservation or letting, despite an advertising sign being placed on the side of a block of flats by a subsidiary company of the landlord.

5.2.1.2 Alteration of rating list - coming into existence

The hereditament (“advertising right”) shall not be treated as coming into existence until the earlier of either:

a. the time at which any structure or sign is erected (after the right constituting the hereditament has been let out or reserved) to enable the right to be exercised, or

b.the time at which any advertisement is exhibited in carrying out the right.

5.2.1.3 Subsequent changes to advertising rights

Once an advertising right has come into existence, the erection, dismantling or alteration of any structure or sign for enabling the advertising right to be exercised shall be treated:

(i) for the purposes of a VO alteration to a Rating List, as a matter affecting the physical enjoyment of the hereditament, and

(ii) for the purposes of proposals to alter a Rating List, as a material change of circumstances.

5.2.1.4 Cessation of advertising rights

The question may arise as to when an advertising right ceases to exist. In legal terms, unless it is extinguished by the agreement coming to an end, or by some other legal means, a right to advertise will still exist whether that right is exercised or not.

However, from a rating point of view, the erection, dismantling or alteration of any structure or sign has an impact on the hereditament and this leads potentially to deletion of the rating list assessment when the structure and/or advertisement are completely removed, even though the right may remain un-extinguished in the background with a rent passing.

Conversely, there are particular valuation considerations that arise at the cessation of an advertising right where the structure is not removed following the cessation of a right. If the right to advertise is extinguished, no rent is passing, and there is no new advertising being posted, then the assessment of the “advertising right” should be deleted from the rating list.

However, any continued advertising on the site might indicate either:

a. a possible “holding over” of the original right let out, in which case the assessment of the “advertising right” should remain in the rating list, or

b. a possible “run on” where no rent is passing, in which case the hereditament should remain in the list as an “advertising station”.

5.2.1.5 Rateable occupier

The person for the time being entitled to a right as mentioned in 5.2.1.1 is to be treated as the rateable occupier; and the four tenets of rateable occupation need not, therefore, apply.

5.2.1.6 Description

Such hereditaments are properly described in the Rating List as “Advertising Right”.

5.3 Land Used for Advertising (no right let out or reserved) – Not Otherwise Occupied but Treated As Such – Advertising Station

Land will be assessable as an “advertising station” where it is not otherwise occupied, no right has been “let out” or “reserved” and the land’s use (permanently or temporarily) is:

a. for the exhibition of advertisements; or

b. for the erection of a structure used for the exhibition of advertisements.

The hereditament should be treated as occupied by the person permitting it to be so used or, if that person cannot be ascertained, its owner; and the four tenets of rateable occupation need not, therefore, apply.

5.4 Land used for advertising (no right let out or reserved) – otherwise occupied

5.4.1 Advertisements exhibited on otherwise occupied rateable hereditaments

Where a hereditament, rateably occupied for other purposes, is used either temporarily or permanently for the exhibition of advertisements, with or without any structure thereon, and no right is so “let out” or “reserved”, then the assessment should ordinarily include the increased value of the land for advertising purposes. If the value of the advertisements is significant, it may warrant inclusion in the description in the rating list. Example descriptions of such would be “Shop and advertising station” and “Car park and advertising station”.

The four tenets of rateable occupation must be present.

[Note: When faced with the same circumstances, the only difference being that a right is “let out” or “reserved”, then the assessment of the rateably occupied hereditament must not include the increased value of that right. It must be separately assessed as an “advertising right”.]

5.4.2 Advertisements exhibited on otherwise occupied non-rateable buildings

In certain exceptional circumstances, otherwise occupied buildings are used either temporarily or permanently for the exhibition of advertisements, with or without any structure thereon and no right is so “let out” or “reserved”. An example of such buildings would be a block of flats. As there is no assessment to increase to reflect the value of the advertisement, a separate assessment will be made. Example descriptions of such would be “Land Used For Advertising”.

The four tenets of rateable occupation must be present.

5.4.3 Other advertising sites and land used for advertising

There may be exceptional situations where land used for the exhibition of advertisements is not a right let out or reserved (described at 5.2.1 above), and, despite being otherwise occupied, none of the aforementioned situations (described at 5.3 and 5.4.1 and 5.4.2 above) apply. Such exceptional situations will only be resolved where the full details of occupation and ownership, both legal and factual, are fully researched.

In summary, If the fully researched facts of a particular situation do not result in a hereditament described at 5.2.1, 5.3, 5.4.1 and 5.4.2, above, then any assessment made in respect of such site or land used for the exhibition or display of advertisements should be ascertained by applying the general principles of rateable occupation.

The four tenets of rateable occupation must be present.

It should be possible to accurately identify the hereditament once the legal circumstances have been ascertained. Therefore a concerted attempt must be made to ascertain details of occupation, ownership and all interest in, and arising from, the land. Reasonable steps should be taken to ascertain the facts; forms of return should be used and enquiries made as appropriate.

However, details may not be forthcoming for a variety of reasons. In such circumstances, it is recommended that certain reasonable assumptions be made. Whilst clearly inferior to having all the facts at the outset, practical assumptions based on observations made during inspections are detailed in paragraph 6.6 below.

Should uncertainty regarding the hereditament persist despite the Valuation Officer’s best endeavours to establish the legal position, and neither do the facts on the ground assist in this regard, it is considered reasonable to describe and treat the hereditament as an “advertising right” in the first instance.

6. Survey requirements

When making an inspection of an advertising display, the survey requirements should include:-

6.1 The site address and environment

The “address” of the site should be formulated using the relevant RSA addressing protocols.

Include the name of the advertising contractor and the site number (both of which are often stated on the edge of the display panel). See Paragraph 7 below where the guidance on capture of site numbers is provided.

A brief description of the site should be noted, to include details of visibility from passing traffic (i.e. pedestrian, train or vehicular). This is referred to as “opportunity to see” (OTS). The position of the site in relation to passing traffic is a critical consideration, as is the “attitude” of the display: is it facing the traffic or angled to some degree and if so, by how much.

6.2 Description of the display, structure and method of affixation

The size and type of display should be noted; together with particular display features such as scrolling, illumination, moving image etc.

Paragraph 1.4 above and Appendix 11 of the VOA Code of Measuring Practice for Rating Purposes provide the traditional sizes of format available for outdoor advertising.

The type of structure should be noted; it may be freestanding or attached to wall or similar support. The method by which the structure is attached should also be noted. For example; a “48-sheet” timber frame bolted to a wall, or a freestanding “96-sheet” on steel frame set in concrete footings.

6.3 Basis of measurement

Paragraph 1.4 below and Appendix 11 of the VOA Code of Measuring Practice for Rating Purposes provide the traditional sizes of format available for outdoor advertising. It is anticipated a single “face” or “side” of each display will form unit of measurement. Multiple display faces and bespoke or spectacular sizes of display will need to treated with care. Although unusual, particularly large or bespoke displays may require to be measured in actual area (in m2) to enable rental and valuation comparison.

6.4 Cost of structures

Refer to the VOA’s Rating Cost Guide for the appropriate list year. Where available and applicable, practice notes attached to this section of the manual may consider structure costs.

6.5 Photographs

Photographs of advertising displays are of great assistance and may be taken from safe vantage points, showing different views of the advertisement.

Photographs should not be taken where the use of the camera (or similar device) will place the officer or members of the public in danger, for example from the middle of a busy road or highway. Similarly, photographs must not be taken whilst driving any kind of vehicle, neither should they involve leaning out of windows and sunroofs of moving vehicles etc.

6.6 A brief guide to identifying whether a Right or a Station (Lands) exists based on an on-site inspection, but in the absence of full legal situation.

When inspecting advertising displays, without knowledge of the legal “backdrop”, together with a knowledge of who is the owner or occupier (as appropriate), it is often very difficult to determine “on the ground” whether there is a “right”, “station” or merely “lands”. In most cases this can only be verified beyond doubt once full details of the legal situation have been ascertained.

However, until the full legal picture is ascertained, the following provides a brief guide to assist in making a determination based solely on what is seen “on the ground”.

The display is more likely to be an advertising right when:

  • It is painted onto, is attached to, or its support structure is attached to, another hereditament, and

  • It is advertising a product or service not associated with the “host” hereditament, and/or

  • Operated by an advertising company (the name of the company will ordinarily be displayed).

Or, alternatively:

  • It is freestanding, on land that is clearly in the occupation of another person, or

  • It is surrounding a building site or similar, and

  • Operated by an advertising company (the name of the company will ordinarily be displayed).

The display is more likely to be an Advertising Station or Land Used for Advertising when:

  • It is painted onto, is attached to, or its support structure is attached to, another hereditament, and

  • It is advertising a product or service within the “host” hereditament and in all likelihood the advertising display is “posted” by, or by the immediate direction of, the host hereditament, and

  • Not operated by an advertising company

Or, alternatively:

  • It is freestanding on land and, whether or not it is operated by an advertising company, and

  • It is land that is clearly owned by the person or company operating the display, or

  • It is land that is not, or unlikely to be, in the occupation of another person, or

  • It is displayed using a very permanent structure involving deep footings and expensive, extravagant or artistic display paraphernalia,

Or, alternatively:

  • It is advertising a product or service available or associated with the land on which is situated.

Certain facts may be verified or corroborated by asking questions of the occupier of the land on which the display is being made, if there is such a person. However, it must be reiterated that the above can only provide an answer based on a “balance of probabilities”.

It becomes even more difficult when the land appears not to be occupied for any other purpose and is otherwise a separate site.

Full notes must be made of the position on the ground to create the best opportunity to make the correct assessment once further and better particulars regarding the legal position are verified, which can be ordinarily be achieved by serving a Form of Return.

6.7 The date of inspection

It is very important to record the date of inspection. Advertising displays can be erected and dismantled with relative ease and planning permission is sometimes applied for retrospectively. This means that the date of inspection is a very important snapshot of the position on the ground at a particular point in time.

The tenets of rateable occupation do not apply to advertising rights, which can have in an entry in the rating list for as little as one day, the importance of recording the situation at a particular point in time cannot be understated.

6.8. Trade advertisements on business premises

Where the same goods as are sold by a particular trader are advertised by posters, painted metal, electric signs, hanging signs, “A” frames etc., attached to or placed in front of the building concerned, most of these advertisements are likely to be of minimal value, especially if they are commensurate or “in keeping” with that expected at that particular business property (for example a newsagent would be expected to have an advertisement displayed on his sunshade awning).

However, where the advertisement appears out of keeping or excessive, it being over and above that expected to be derived from a commensurate display, it is likely it should be taken into account when adjusting any rent and making a valuation of the hereditament. For that reason, full details should be ascertained and photographs of the display recorded in RSA wherever possible.

In such circumstances and where considered appropriate, the Other Additions (OA) code of “ADV - No. of Advertising Stations” is available for use (see also paragraph 9.1 below).

6.8.1 Business premises and advertising rights

If a Form of Return (FOR) discloses the receipt of a rent for advertising, the VO should consider making such further enquiries, either informally or serving a supplementary FOR, as would enable a decision to be made as to whether the advertising warrants separate assessment as a right let out from land.

6.8.2 Business premises let out in parts and advertising displays

Where buildings are let out in parts, it may be that the occupier of a part displays an advertisement on his own or some other part of the building. In cases where such signs are “directional” (i.e. to assist in locating an occupation) or for identification purposes rather than for advertising, they should have no value placed upon them.

However, if, by virtue of their size, prominence or obvious advertising value they are clearly advertisements (and therefore distinguishable from directional and identification signs), they should be assessed as rights or stations as appropriate.

Normal advertising displays, such as 48-sheets, erected around a building site are likely to be rights let out and should be assessed. However, temporary signs to indicate their presence erected by building contractors on land where they are engaged on constructional or repair work may be disregarded, as may unauthorised fly posting.

7. Survey capture

7.1 Capture of site numbers - essential for identification within address creation

Address capture protocols must be followed when creating addresses for advertising hereditaments in the Rating Support Application (RSA).

The inclusion of the site number and ratepayer name in the Rating List address will greatly assist the identification of the site by the VOA, billing authority and the advertising company.

In future and wherever possible, caseworkers are reminded to include the site number and name of the ratepayer (typically an advertising company) in the address when bringing any new display sites into the Rating List. This also applies when altering the list following the settlement of proposals or when dealing with list maintenance work in general.

The reference codes or numbers are often found on the edge of the displays. Wherever a site identification number is visible on the display site (or provided separately), it is essential to include this reference code or number in the address on address creation.

Further guidance in respect of particular types of display is provided below.

7.1.1 Bus shelter advertising

All operators of bus shelter adverting adopt some kind of identification system and typically each bus shelter has a unique reference number displayed somewhere on the shelter. These can be numerical or alphanumerical; it should be noted in all cases and wherever possible incorporated in the rating list addresses.

This unique identification reference number is normally located on the top corner of the bus shelter, facing the road. It is typically an 8-digit number, but could be any length.

7.1.2 Telephone box advertising

When creating the address for a right to advertise from a telephone box (including phone boxes with BT “StreetTalk” and “StreetTalk 6” display advertising), the full UK telephone number of the telephone box (or kiosk), together with the name of the advertising company, must be incorporated in the rating list addresses.

7.2 Capture in EDRM, Survaid and the Rating Support Application (RSA)

All survey details relating to advertising hereditaments must be captured using the Rating Support Application (RSA).

All relevant notes, plans and inspection checklists should be captured on EDRM as appropriate. Photographs should be placed on RSA.

The guidance provided by “Survaid” (associated “VSA Standards” information and any relevant “Standard Valuation Scale scope documentation” is attached to “Survaid”) should be followed when approaching the survey capture of advertising displays. The relevant Special Category Codes when using “Survaid” are 003 (Advertising Right or Station) and 146 (Land Used for Advertising).

Following data capture into RSA, and for the purposes of all rating lists since 2005, advertising displays are referred to in terms of single sides or single panels. Displays must be captured for RSA in terms of ‘single sheet panels’ or ‘single display faces’.

8. Valuation approach

8.1 General valuation considerations

8.1.1 Rental method

Valuation will be on the rental method but care needs to be exercised when using the available evidence to ascertain whether or not the amount paid takes into account the value of any structure or sign. In arriving at the RV it is not relevant that a structure or sign was provided by the occupier or was provided after a right was let out or reserved, it still falls to be valued.

8.1.2 Market evidence

Market evidence of rental values is usually widely available, especially for larger format advertising displays. Care must be taken in deriving evidence from comparables because as location is the key factor, rental values will vary considerably from site to site.

There is rental evidence available in respect of smaller format displays, but there are also many instances where there is no rent passing, such as advertising displays on bus shelters already mentioned above. In such circumstances it is desirable to devise a valuation scheme; refer to the relevant practice note for the appropriate list year, as attached to this section to see if a centrally formulated scheme is available that may assist.

8.1.3 Where a right is separately assessed from land

Where a right falls to be separately assessed from land no account is to be taken of the value or increased value of that land by reason of its use for exhibiting advertisements: this provision ensures that the value of the right is not the subject of duplicate assessment.

8.1.4 Position of hoarding

Care is necessary in considering the position of the hoarding relative to passing motorists and pedestrians, its visibility, the speed and volume of traffic passing the site, as well as the size and nature of the population of the area in which the hoarding is located.

8.1.5 Visibility and location

A visible and well-located hoarding alongside a busy commuter route will be seen by large numbers of motorists, especially in urban areas where traffic is slow moving or stationary (road junctions for example) where there is time for the message to be absorbed.

8.1.6 Site of hoarding

Sites parallel to the road are likely to be less valuable than those which are angled; and sites visible to traffic from both directions are more valuable than sites which can only be seen from one direction; sites near traffic lights where the flow of traffic is interrupted may be more valuable than sites where traffic passes quickly. If the location is such that it is likely to be seen by a larger proportion of people in socio-economic groups A and B, it may well command a higher rent.

8.1.7 Type of display

The types of display operators envisage placing on the site typically indicate the value of the site to the advertiser. It follows that the rents agreed in respect of advertising rights (or land used) will take into account the fact that the intended use is a multiple display. Such displays include scrollers, ultravisions and digital displays. See paragraph 1.4.1 above.

In general, the value of the right increases in relation the number of “faces” displayed over a reasonable period of time. For example, a right displayed using a 3x ultravision or scroller may be around 3x the value of a static sheet.

Similarly, a “digital” display has a theoretically large capacity for displaying advertisements. It is important to know the number of display faces shown and type of display. This will enable more accurate valuations to be made as, in practice, an advertising company sells up to an equivalent of six “faces” per digital display. Therefore, where electronic or digital formats are used, the valuation of the right might be enhanced by as much as 6 times the normal single sheet rate.

8.1.8 Evidence of similar locations not available

Where suitable evidence of similar locations is not available, particularly where a new site is being evaluated, it should be remembered that, ultimately, the rental value of the site derives from the revenue received by the hoarding company from advertisers.

8.2 Specific valuation considerations

8.2.1 Small format advertising displays on bus shelters and lampposts

For the purpose of this paragraph, “small format” advertising displays are the size of a 4-sheet or 6-sheet. Location maps and timetables clearly in the occupation of the bus operator should not be assessed. The relevant revaluation practice notes tend to provide valuation advice and guidance in respect of small format advertising displays and these should be referred to as necessary.

8.2.2 Bus shelters

All advertising on bus shelters should be assessed, with the value of the structure usually being based on the cost of providing either the bus shelter itself (where the hoarding and bus shelter are dependent for support on one another) or where the display is capable of standing with or without the shelter “attached”, the cost of providing such a freestanding structure.

A typical agreement, usually in the form of a licence, for such displays as between the advertising company and a local authority will usually include terms that the former shall:

  • supply and erect the shelters at their own cost at agreed locations

  • pay fees for any necessary planning consent

  • have exclusive rights for the display of advertisements

  • pay for all electricity consumed

  • be responsible for all maintenance and repair

  • be responsible for insurance;

and that the Local Authority shall:

  • make good all footpaths

  • be responsible for the supply of electricity to the site

  • keep the pavement swept beneath each shelter

  • be permitted to affix bus time tables to any shelter.

It is unusual for any rent to pass on the basis that the council presumably considers that the total value of the provided, and their ongoing maintenance, offsets the revenue that could otherwise have been collected by letting out the rights. Sometimes a few additional shelters are provided where no advertising is included and occasionally other facilities such as automatic toilets may be provided and maintained as part of the agreement.

8.2.3 Lampposts

Small Format advertising on lampposts should be assessed, with the value of the structure usually being based on the cost of providing a freestanding structure capable of making that display at the height at which it is made.

Care should be taken when comparing with bus shelters. Although a similar size of display, the visual impact, height from the ground and costs of structure are likely to mean a difference in rateable value to those of bus shelters.

8.2.4 Small format advertising displays on “sponsored” roundabouts

For the purpose of this paragraph, “small format” advertising displays are the size of a 4-sheet or 6-sheet. Very small “plaques” or “name plates” in a flowerbed in a roundabout do not fall into this category and instead are dealt with in paragraph 8.2.5 below.

Arrangements for the use of roundabouts as advertising are ordinarily entered into between the local authority and the advertising companies, both parties being subject to similar rights and responsibilities as outlined in paragraph 8.2.2 above, depending on the nature of the advertisements.

The roundabouts used for such displays are often referred to “sponsored roundabouts”. A feature of the arrangement in respect of “sponsored roundabouts” is that the money raised appears to be targeted directly into the improvement of the amenity value of the roundabouts in the locality. In this way, local companies can be seen to play a part in improving their local area, benefiting from the advertising as a result.

8.2.5 Very small advertising displays in general

For the purpose of this paragraph, “very small advertising displays” are those being less than half the size of a 4-sheet.

Very small displays exhibiting advertisements are sometimes placed on street furniture and other features on the highway. Examples include parking meters, roundabouts, street signs, lampposts, bus stops, traffic light poles, litter bins and utilities cabinets.

It is considered highly unlikely that individual assessments will arise in such instances. However there may be a case for assessment if the rental value of very small format advertising displays supports it. Similarly, assessment may be appropriate by agglomerating the values of very small displays. Care should be taken before taking the latter action and facts must be carefully established; the displays must stem from the same right, or be on the same piece of land (if no right is let out): it is therefore recommended that specialist technical advice be sought using established protocols before doing so.

8.2.5.1 Authorised display of very small format advertisements

Agreements may exist between an authority and advertising company for the co-ordinated use of certain multiple items of “street furniture” for the display of very small format advertisements. It is expected in such instances that both parties be subject to similar rights and responsibilities as outlined in paragraph 8.2.2 above, depending on the nature of the advertisements.

Although unlikely that individual assessments will arise in such instances, should a valuation officer wish to proceed to assess very small displays of this nature, full details of the arrangements between the advertising company and “authorising authority” must be established before proceeding. Caseworkers should also seek technical advice using established protocols before doing so.

8.2.5.2 Unauthorised display of very small format advertisements

Clearly unauthorised campaigns of advertising, whether seemingly co-ordinated or not, such as plastic coated A4 sheets held on to traffic light poles by plastic ties, should not be assessed as they are effectively unauthorised fly posting.

8.2.6 Advertising and telephone kiosks

Where an advertising display on a phone box or kiosk is clearly let out by the telephone company to an advertising contractor, the display should be assessed as an advertising right. This applies whether the kiosk is on the highway or not.

Where the display is advertising services provided exclusively by the company concerned, it is probably not let out and therefore should not be assessed separately, its value should be included in the assessment of the phone box or where a company is a hereditament in the central list, included in that assessment.

For further information about the valuation of telephone kiosks and the like for rating purposes, refer to Rating Manual section 6 part 3 - section 1035.

8.2.7 Advertising and railways

The position historically in respect of those railway hereditaments shown in Central Lists is that their advertising sites have been included in the valuations, and until recently no agreements were identified which have the effect of creating any rateable occupier other than the statutory operator.

Railtrack plc was created on 1st April 1994 and all land used for railway purposes was transferred to it from the British Railways Board (B.R.B.). Surplus property not required for Railtrack PLC’s purposes continued to be held by British Railways Board. B.R.B. ceased to be a “designated person” in the 2000 Central List Regulations and their occupations are now individually assessed in the local lists with effect from 1 April 2000.

Following a period during which it was in administration, Railtrack PLC was renamed Network Rail Infrastructure Limited, and continues to be a designated person for the purposes of the 2000 and 2005 Rating Lists.

For the avoidance of doubt, advertising displays should be placed in local rating lists where they are either let out from land or stationed on land that is not in the occupation of a person designated to appear in Central Lists.

8.2.7.1 Advertisements on working railway property currently occupied by Network Rail Infrastructure Ltd

Included in the Central Rating List for Network Rail Infrastructure Limited are those advertising sites managed under its central management agreements that are situated on land associated with operational railways, which is being used wholly or mainly for the purposes of the carriage of goods or passengers by rail. As a result no separate assessment in Local Rating Lists falls to be made for such sites. It is understood that there may also be a number of similar agreements with other poster companies and, where situated on land occupied by for Network Rail Infrastructure Limited, these should be treated in the same way.

For the purposes of dealing with advertising displays, there is no distinction between “operational” and “non-operational” railway land, and the expression “operational land” should not be cited as a reason to distinguish between the way advertising on railway land is dealt with. Instead, the distinction is between;

a. land that is being used wholly or mainly for the purposes of the carriage of goods or passengers by rail, that is in the occupation of Network Rail Infrastructure Ltd, and b. land that is not being used wholly or mainly for the purposes of the carriage of goods or passengers by rail, (or “defunct” railway land) that is in the occupation of BRB (Residuary) Ltd.

For the avoidance of doubt, once it is established that Network Rail Infrastructure Ltd occupies the railway land in question, that is enough to satisfy the Central Valuation Officer that any advertising sites managed by them are to be placed in their Central List assessment.

8.2.7.2 Advertisements on defunct railway property currently occupied by BRB (Residuary) Ltd

Where land is not being used wholly or mainly for the purposes of the carriage of goods or passengers by rail, or is defunct railway property occupied by BRB (Residuary) Ltd, then the advertisements let out from that land would be expected to be assessed in accordance with the ordinary law of rating.

Once the facts are established as detailed above, the way to deal with advertising on railway land should become clearer. However, details of any disputes over such assessments should be submitted to the Technical Adviser. Current protocols for seeking further advice should be followed as considered necessary.

8.2.7.3 Advertisements on London Underground, Docklands Light Railway, and Tyne & Wear Metro’ land

It is understood that no advertisements are situated on land that is not being used for the relevant purposes.

8.2.7.4 Further information

For further consideration of advertising and railways, refer to Rating Manual section 2 part 2 and the relevant practice note, where available, which will ordinarily have a paragraph on advertisement sites incorporated therein.

8.2.8. Advertising and canals

It is understood that all advertisements displayed by The British Waterways Board (BWB) on canal hereditaments are used for purposes ancillary to the provision of facilities for traffic by inland waterways or in harbours and as such are thus included in the valuations. Any other advertising right displayed on canal premises should be assessed and entered in the appropriate Local Rating List. Details of any disputed assessment on the grounds that a right is included in a BWB valuation should be submitted to the Technical Adviser.

9. Valuation support

Valuations should be performed on the Rating Support Application (RSA), which contains a bespoke scale for advertising displays. This is expected to form the basis of any Valuation Scheme.

9.1 Advertising displays as part of another hereditament

Where an advertisement display on a hereditament (such as a shop, office or warehouse) appears out of keeping or excessive, and its value is over and above that expected or such a hereditament, and it is not let out or reserved, it should be taken into account when making the assessment of the hereditament.

In such circumstances and where considered appropriate, the Other Additions (OA) code of “ADV - No. of Advertising Stations” is available for use (see also paragraph 6.8 above).

9.2 Ascertaining the effective date

When determining the effective date of any new entry, alteration or deletion, care must be taken to fix an effective date that is as correct as possible, subject to the powers contained in the appropriate effective date regulations. However, due to the nature of the regulatory framework that surrounds outdoor advertising, it is important to exercise caution and apply an effective date that is based on known facts rather than assumptions. The physical facts will be ascertained during an on-site inspection (See paragraph 6).

9.2.1 New entries

The billing authority may have provided an effective date, and where that date appears reasonable it should be used. However, the effective date should be ascertained as follows: where the date the right is first exercised is known (see Para 5.2.1.2 above for details), it should be used; if that date is not known exactly, but known to be earlier than the list compilation date, the list compilation date should be used. If the date is not known and the situation at the list compilation date is not known, the date the alteration to the rating list is being made should be used.

If the advertising company disputes the effective date (whether such a date is provided by the billing authority or used by the valuation officer), the alleged date of installation should be provided in writing, together with copies of the relevant installation paperwork provided and the name and contact details of the installer (whether a subcontractor or employee).

9.2.2 Alterations

The billing authority may have provided an effective date, and where that date appears reasonable it should be used. However, the effective date should be ascertained as follows: where the date the hoarding (or equivalent) is altered is known (see Para. 5.2.1.3 above for details), it should be used; if that date is not known exactly, but known to be earlier than the list compilation date, the list compilation date should be used. If the date is not known and the situation at the list compilation date is not known, the date the alteration to the rating list is being made should be used.

If the advertising company disputes the effective date (whether such a date is provided by the billing authority or used by the valuation officer), the alleged date of alteration should be provided in writing, together with copies of the relevant paperwork provided and the name and contact details of the person making the alteration (whether a subcontractor or employee).

9.2.3 Deletions

The billing authority may have provided an effective date, and where that date appears reasonable it should be used. However, the effective date should be ascertained as follows: where the date the hoarding (or equivalent) is removed is known (see Para. 5.2.1.4 above for details), it should be used; if that date is not known exactly, but known to be earlier than the list compilation date, the list compilation date should be used. If the date is not known and the situation at the list compilation date is not known, the date the alteration to the rating list is being made should be used.

If the advertising company disputes the effective date (whether such a date is provided by the billing authority or used by the valuation officer), the alleged date of installation, alteration or deletion should be provided in writing, together with copies of the relevant paperwork and the name and contact details of the person who erected, modified or removed the structure (whether a subcontractor or employee).

9.3 The description to be placed in the rating list

As already mentioned in paragraph 5.2 above, where uncertainty exists, it is reasonable to presume, describe and treat the hereditament as an “advertising right” in the first instance.

Where it becomes clear from the subsequently ascertained legal position that the initial description in a rating list is incorrect, its description should be changed.

Any such change to the description in a rating list (from right to station to land used etc) is unlikely affect the valuation of the hereditament, or the validity of the assessment. However, if what was initially considered a right turns out in fact and law to be land used for advertising, rateable occupation becomes a fundamental consideration in relation to permanence (see paragraph 5.2 above).

In any case where there is doubt about the legal situation, an FOR must be issued to clarify the position and other reasonable enquiries made. If clarification is required because either “permanence” is an issue, or there is some other pertinent issue that has arisen, the VOs should submit full details to the Technical Advisor for advice.

9.4 Appendix 1 - advertising rights and advertising stations – relevant excerpts from legislation

See Appendix 1 for relevant statutes.

Practice note 2017: Advertising rights and advertising stations

small format 4-sheet and 6-sheet displays, including those on bus shelters and at supermarkets

1. Market appraisal

According to figures available from the Outdoor Media Centre (sourced in August 2015 and based on figures compiled by the Advertising Association/WARC), total advertising spend in the UK was £18.533 Billion for the year ending December 2014 (compared to £17.756 Billion in the year ending December 2007). However, there was a pronounced dip in overall spend in the intervening period between January 2009 and December 2012. The annual spend on media in the UK between 2007 and 2014, together with the out of home (outdoor) contribution is as follows:

Annual Advertising Spend

(£,000)

 

Out of Home (Outdoor Advertising) Spend

(£,000)

 

to 31 Dec 2007

£17,756,000

to 31 Dec 2007

£976,000

to 31 Dec 2008

£18,600,000

to 31 Dec 2008

£939,000

to 31 Dec 2009

£16,300,000

to 31 Dec 2009

£782,000

to 31 Dec 2010

£15,500,000

to 31 Dec 2010

£881,000

to 31 Dec 2011

£16,102,000

to 31 Dec 2011

£886,000

to 31 Dec 2012

£17,176,000

to 31 Dec 2012

£970,000

to 31 Dec 2013

£17,877,000

to 31 Dec 2013

£990,000

to 31 Dec 2014

£18,553,000

to 31 Dec 2014

£1,019,000

These figures indicate that out of home advertising in represented in the year ending December 2014 around 5.50% of the total advertising spend in the UK; this share is the same as it was in 2007 and, despite the total spend between 1 January 2009 to 31 December 2012 shrinking significantly, out of home has maintained its share, being between 4.80% and 5.68% of overall UK media spend throughout the period.

Interestingly, whilst out of home has maintained its share of overall spend over the seven year period, the spend on internet advertising has increased significantly, seemingly at the expense of newspapers, other print media and direct mail.

Although strictly speaking outside the scope of this small format practice note, the figures available suggest the following regarding the use of all types of outdoor displays over the period April 2008 to April 2015:

  • The use, type and distribution of outdoor advertising displays has changed and evolved over the period from 2008 to 2014; however, the overall total number of displays available in 2014 is roughly the same as that available in 2008.

  • The 6-sheet shows no sign of losing its popularity as a medium, increasing in number over the period to around 78,000 (76,800 in 2008), representing some 60% of the displays in the outdoor market in 2014.

  • The actual number of 48-sheets has dropped between 2008 as 2014 by around 20% to 20,000; the 48-sheet in 2015 represents around 19% of all display types.

  • The actual number of 96-sheet displays reduced by 40% from 2008 to 2014; they represent less than 2% of all displays and numbered around 2,000 in 2014.

  • “Others”, including “Banners” (large fabric type displays), spectaculars and bespoke formats have maintained their share of all displays.

  • Digital media are becoming more of a feature in large format outdoor advertising displays.

Looking beyond April 2015 is difficult, but based on current knowledge the following observations can be made:

  • It appears that in 2015 the advertising industry remains stable in terms of overall spend on UK advertising and has ‘bounced back’ from 2013 onwards.

  • The spend has been increasing both year on year and proportionately in terms of out of home (outdoor advertising) since 2012. This steady increase in spending looks set to continue for the foreseeable future.

  • Whilst for many years small format indoor displays (shopping centres and superstores) have seen a move into digital formats, there is an increasing trend towards digital on both small and now large format outdoor displays. This could herald the beginning of a sustained focus on digital, initially in respect of the most prominent display sites. Whether this is at the expense of the more traditional 48-sheet and 6-sheet formats and what happens to these sites remains to be seen.

  • Advertising has always been a dynamic and changing media, embracing new technologies and formats, seeking to attract the attention of a particular target audience. Outdoor is no exception to this forward movement and the opportunities afforded by digital technologies suggests outdoor display formats will remain a critical campaign option available to the advertiser.

2. Changes from the last practice note

The following broad changes and observations should be considered when comparing the guidance contained in the previous (2010) practice note to this 2017 practice note:

  • Valuation guidance and prices have been provided for the same formats as previously.

  • The categorisations of small format bus shelter displays remain the same in terms of position and location.

  • Bus shelters - There has been in general an increase in figures of around 10% for the best bus shelter display types, diminishing to ‘no change’ in respect of the bus shelter positions outside city and major town centres. Certain ‘other’ categories both in 6-sheet and 4-sheet formats are now lower than last time.

  • Superstores and Petrol Filling Station displays - There has been a general increase in the prices of all ‘point of sale’ advertising displays. There are increases of 25%-30% for the better positions and situations.

3. Ratepayer discussions

Discussions have taken place with representatives for Clear Channel UK Ltd., JC Decaux and Primesight in respect of the levels of value to be applied for the Revaluation 2017 for 6-sheet and 4-sheet panels on bus shelters and certain superstores.

Available evidence of rents on small display advertising has also been examined. Similarly, bus shelter and small format advertising has been considered in the context of more general advertising industry indicators and trends.

4. Valuation scheme

4.1 Overview of approach and schemes

In general, the approach detailed in Rating Manual section 6 part 3 - section 20 should be adopted when making valuations in respect of advertising rights or stations, and land used for advertising.

This Practice Note provides valuation guidance on the valuation of small format advertising displays for the 2017 Rating Lists. Included are small format 4-sheet and 6-sheeet displays, in particular bus shelter, petrol filling station, motorway service area and supermarket advertising displays.

Also included is the approach to be taken in respect small format displays at sponsored roundabouts and those on lampposts.

The figures in this note are expressed in terms of “single sides” or “single panels”; additionally, the figures must not be used for any display sizes larger than the modern 6-sheet, being 1.8m x 1.2m.

Guidance on the categorisation of any particular town and city and the relative location classifications within that town and city is given below. The basis of classification remains as adopted for earlier Rating Lists; the general expectation is therefore that categorisation and classification adopted for R2010 will apply for R2017.

4.1.1 Categorisation of towns / cities

The scheme of valuation identifies four urban categories:

  • Central London (excluding certain “key higher value” locations, e.g. Oxford Street)

  • Cities and outer London Boroughs

  • Major Towns

  • Other Towns

In the majority of cases it should be straightforward to decide upon the most appropriate category and classification to adopt for any particular bus shelter location.

However, regard may be had to additional factors such as population size, any local restrictions on advertising, whether “Heritage” Centres and whether the shelter is in a Historic City or Town. These factors may have a bearing on the categorisation/classification decision to be made

Central London

The relative categorisations within Central London are now well established and these remain unchanged for 2017 purposes.

Within Central London, the “key higher value” locations are excluded from the scope of this practice note and values are not provided. This repeats the approach taken in previous revaluations. It is therefore envisaged that the Units responsible for “key higher value” locations in Central London will establish and apply appropriate levels of value depending on the relative merits of the locations concerned.

Cities, outer London boroughs, major towns and other towns

For 2017, determining the correct categorisation of any city or town is again most important. It is however envisaged that the work completed by Units during maintenance of the 2010 lists will have established the relative strengths and the therefore the appropriate categorisation of Cities, Boroughs and Towns from an advertising perspective.

It is already established that some “Cities” could be more appropriately categorised as “Major Towns” and, conversely, some “Major Towns could be categorised as “Cities”

4.1.2 Classification within towns / cities

Within each of the four “urban Categories” above, the scheme of valuation identifies three locations:

  • Town Centre

  • Main Roads

  • Other locations

It is important to build on the valuable work already done in determining the relative strengths of advertising position and not revisit this area unnecessarily.

Town centre

This should be taken as meaning the main central shopping and commercial centre of the particular conurbation concerned.

Main roads

The majority of bus shelter sites falling into this classification are likely to be situated on main roads. Main road locations should include the principal commuter routes into the city/town centre, the main arterial routes, the main suburban high streets and certain high volume locations such as the approach road to a major superstore.

Other locations

These will include feeder roads, minor roads, residential suburbs and estates, This classification is also likely to encompass neighbourhood and small local “estate type” shopping centres.

4.2 Data capture and the Rating Support Application

Advertising Displays are a class offered valuation support on the VOA Rating Support Application (RSA).

All values shown in this practice note are expressed in terms of single-sheet panels.

4.3 Structure, planning and Illumination

All figures provided in this practice note reflect costs for structure, planning and illumination as appropriate.

Where valuation officers obtain rental information in respect of advertising rights, care must be taken to adjust such rents by an appropriate amount depending on the type of display; costs must be amortised and added to the rent as appropriate. This is how the 2017 valuation schemes in respect of the majority of larger format advertising displays would be expected to operate.

However, when formulating 2017 valuation schemes for small format advertising displays and where the figures are taken from this note, it is recommended that separate matrices be created for bus shelter, supermarket, lamppost, petrol filling station, motorway service areas and sponsored roundabouts as appropriate that reflect these features. For such small format schemes, it is important that the matrix description state, “All prices in this valuation scheme include structure, planning fees and/or illumination” or something to that effect.

4.4 Bus shelter displays – 2017 list values to be adopted

The vast majority of advertising panels at bus shelters are displayed as 6-sheets, the typical format being double-sided, 6-sheet displays.

A small number of 4-sheet panels still remain, however as the figures provided in the “Market Appraisal” at paragraph 1 suggest, these are being gradually removed and/or, if considered viable, replaced with 6 sheet panels.

4.4.1 Bus shelter 6-sheet panels

For bus shelter 6-sheet panels, the following values, expressed in terms of a single 6-sheet panel, should be adopted:

2017 List Values: Bus Shelters

6-Sheet Panels (£/single panel)

Town Centre (£)

 

Main Roads (£)

 

Other(£)

 

Central London (Excluding Certain “Key Locations”, such as Oxford Street).

1100

650

375

Cities and Outer London Boroughs

600

425

225

Major Towns

425

300

185

Other Towns

325

225

125

4.4.2 Bus shelter 4-sheet panels

In the absence of any local evidence to the contrary, any remaining bus shelter 4-sheet panels should be valued on the following basis, expressed in terms of a single 4-sheet panel:

2017 List Values: Bus Shelters

4-Sheet Panels (£/single panel)

Town Centre (£)

 

Main Roads (£)

 

 Other (£)

 

Cities (including London but not London key locations as defined above in chapter 4.1)

170

125

80

Major Towns

135

90

70

Other Towns

100

75

50

4.4.3 Bus shelter displays – other considerations

Other features that may need consideration when dealing with the valuation of bus shelter advertising displays are considered in the following paragraphs. Advice is also given on aspects of data capture and rating list address creation.

4.4.3.1 Bus shelters with additional static panels

In respect of those bus shelters that have more than the standard “double 4-sheet” or “double 6-sheet” static display panels, the following approach, which replicates that taken during 2005 and 2010 Rating List maintenance, should be adopted for 2017.

For bus shelters containing more than one double panel or two single panels, it is accepted that in most cases the additional static panels do not have the same value as the first two static panels. In such cases the subsequent static panels should be valued at 50% of the appropriate single panel price.

For example:

Where the single 6-sheet panel is £425, the third and any subsequent static panel should be taken at £212.50 each, being 50% of £425.

There may however be some exceptional cases where this reduced rate for third and further additional panels would not apply. For example, where a bus shelter is situated outside an underground or railway station, and where the additional static panels are specifically sited to attract the pedestrians going into and out of the station.

Each case should be judged on its own merits but in these exceptional cases, any additional static panels are expected to be valued at the same single sheet rate as the first two single panels. In other words, additional panels in exceptionally good locations typically attract no discount.

4.4.3.2 Bus shelters with scrollers

Some bus shelters display multi‑scrolling 6-sheet panels. Such scrollers tend to be located in the more prominent locations and normally display 2, 3 or 4 sheets per panel face.

The scrolling panel usually has a static display panel on the rear side. It is rare to have two scrollers “back-to-back”.

In respect of bus shelters that have scrollers, the appropriate single sheet rate should be applied to each scrolling face with no discount.

4.4.3.3 Bus shelters with electronic or digital displays

Using what is a relatively new and improving format, some bus shelters incorporate electronic or digital media to display advertisements on 6-sheet panels. Such displays are steadily increasing in number. They tend to be located in the more prominent locations offer the equivalent of 6 sheets per panel face in terms of their ability to be placed in national advertising “packages”.

The electronic panel may have a static display panel on the rear side. They are not as bulky as scrollers, so there may also be situations where there are two electronic or digital panels “back-to-back”.

In respect of bus shelters that have electronic or digital displays, six times the appropriate single sheet rate should be applied to each electronic or digital display with no discount.

4.5 Supermarket 6-sheet panels – 2017 list values to be adopted

For the purposes of this paragraph, superstores include large hypermarkets and supermarkets and modern standalone superstores with significant parking provision. The figures shown below should not be used in respect of 6-sheet advertising at traditional convenience stores located in a parade of local shops, or convenience stores at petrol filling stations.

Refer to paragraph 4.7 below for lamppost advertising in retail car parks.

The values to be adopted for 6-sheet panels displayed at superstores are dependent on the named operator of the store. Where details are known, the terms of licence agreements between the supermarkets and the advertising company remain unchanged following renewal. This is thought to be mainly due to the “profit-share” elements built into the arrangements on top of the base rent figures.

It has been established that both Tesco and Sainsbury retain specific rights to use panels themselves for a percentage of the time. This percentage is specified in the licence agreements and is a “retained right”; therefore in these circumstances it is not correct to value these individual panels at a level reflecting the right to advertise for 100% of the time.

In practice, those supermarkets having retained rights tend to use a particular number of panels, but not necessarily the same panels, at any one time. The combination of panels used by the supermarket appears to be agreed between the parties with due consideration for position, duration etc.

The “adjusted figures” recommended below for the main supermarkets take account of the percentage of advertising time retained by Tesco and Sainsburys, and for 2017 this percentage remains unchanged from that recommended in previous rating lists.

Two sets of figure are therefore provided. The first set of figures represents the full value of a standard 6-sheet panel at any particular supermarket. However, it is the second set of figures that must be adopted in the valuation of each single 6-sheet panels at the particular supermarkets mentioned. The figures only differ where the host is known to reserve advertising time.

In respect of applying figures more widely, attention is also drawn to the guidance provided in paragraph 4.10 below.

The figures provided below are expressed in terms of single-panel 6-sheet.

2017 List Figures: Supermarkets

6-Sheet Panels (£/single panel)

2017 Unadjusted figure (£)

2017 Adjusted figure to be adopted (£)

Kwiksave*

750

750

Co-op*

750

750

Somerfield*

750

750

Morrison*

1000

1000

Asda*

1300

1300

Waitrose*

1500

1500

Tesco

1500

1250

Sainsburys

1500

1000

*It will be noted that the “Unadjusted” and “Adjusted” figures are exactly the same for these supermarkets, as it is understood that the licences for these supermarkets do not specifically retain within their control any part of the right to display.

4.6 Petrol filling station forecourt panels – 2017 list values to be adopted

Central guidance is provided in respect of 6-sheet panels displayed at petrol filing station forecourts. Available rental information indicates that around 85% of forecourt advertising displays can be valued by reference to a single figure.

This means 85% of 6-sheet displays are located on stand-alone petrol filling station forecourts on classified A and B roads in urban and suburban locations.

On either side of this broad range, other displays are located in popular “honey pot” locations or on country lanes and in village centres.

The figures shown in the table below should not be adopted for displays on petrol station forecourts at motorway service stations, which should be dealt with by reference to paragraph 4.8 below. Neither should the figures be adopted for displays in petrol station forecourts in superstores where the petrol station is included in the superstore assessment.

The figures provided below are expressed in terms of single-panel 6-sheet. The approach to dealing with scrollers and electronic displays at paragraph 4.4.3 above should be adopted. However, there it is not appropriate to discount for multiple displays or additional static panels.

2017 List Figures: Petrol Station Forecourt

6-Sheet Panels (£/single panel)

Figure (£)

 

National Percentage of Petrol Stations where the figures are expected to apply

Premium locations: Trunk Roads and “honey pot” locations such as sports venues and stadiums, concert halls and near large regional shopping centres.

 

 600

10%

Majority of locations: All classified A & B Roads, urban and suburban locations on main traffic routes.

 

 450

85%

Remote locations: Country Lanes and villages.

 

 250

5%

If rental information becomes available in support of any challenge to the application of the above figures, full details of the rent must be ascertained and further advice sought using the protocols for seeking advice as appropriate.

In respect of applying figures more widely, attention is also drawn to the guidance provided in paragraph 4.10 below.

4.7 Lamppost advertising on 6-sheets – 2017 values to be adopted

Double sided 6-sheet advertising displays mounted within the vertical structure of lampposts appear from time to time. The arrangements in respect of lamppost advertising displays are often similar to that which operates in respect of bus shelter advertising, in that the local authority is provided with new lampposts (or some other benefit) in exchange for the right to advertise on them being granted.

The panels are typically two and a half to three metres above ground level and not only display advertising on in roadside locations, but also display 6-sheet advertising on lampposts and poles within shopping centre and retail park car parks.

4.7.1 Lampposts on roadside locations in towns and cities

The following values are recommended in respect of 2017 valuations in the absence of any better evidence of value derived from an analysis of rental or other direct comparable evidence.

2017 List Figures: Lamppost Advertising on Roadside: 6-Sheet Panels (£/single panel)

 

Figure (£)

 

Cities and Towns where it is anticipated the respective figures apply

Central London (Excluding Certain “Key Locations”, such as Oxford Street)

 

275

 

Cities and Outer London Boroughs

 

 

190

For example, Leeds and Coventry

Major Towns

 

 

 

160

For example, Rochdale, Newport, Oldham, Hartlepool

 

Other Towns

 

 

125

For example, Ashby de-la Zouch, Devizes

The considerations made when determining the correct categorisation of “City” or “Town” as described in the left hand column of the table are the same as those made in respect of the bus shelter scheme (see above).

4.7.2 Lampposts in shopping centre and similar retail car parks

Where 6-sheet panel advertising rights are identified on lampposts in shopping centre and retail park car parks, available rental details should be obtained, adjusted, analysed and adopted as appropriate. However, in the absence of rental evidence, the figures shown in the table below should be adopted.

2017 List Figures: Lamppost Advertising in Shopping Centre and similar Retail Car Parks: 6-Sheet Panels (£/single panel)

 

Figure (£)

 

Locations where the respective figures apply (and anticipated %age of parks)

Within the M25 (Excluding Central London, being Westminster, City, Camden, Kensington and Chelsea)

 

300

Also applies to major out of town shopping centres outside the M25, such as Bluewater, Lakeside, Cribbs Causeway, Trafford Park, Meadowhall, Merry Hill and the Metro Centre.

(20% of parks are anticipated to fall into this category)

 

Outside the M25 in England and Wales – Normal

 

 

250

Most locations outside the M25.

(70% of parks are anticipated to fall into this category)

Outside the M25 in England and Wales – Poorer

 

 

 

150

This category should only be used where rental evidence supports it (10% of parks are anticipated to fall into this category)

 

Where there is any difficulty determining those situations at the boundary of the “Normal” and “Poorer” categories outside the M25, guidance from National Specialists Unit (NSU) should be sought using the usual protocols.

The figures provided for supermarkets at paragraph 4.5 should not be used to value lamppost 6-sheets, as they relate to named supermarkets only.

Figures for 4-sheet advertising displays are not provided as they rarely constitute the type of lamppost advertising display intended to be dealt with in this paragraph. Therefore, should it become necessary to place a value a 4-sheet (or any other) display on a lamppost, guidance should be sought from National Specialists Unit (NSU) using the usual protocols.

4.8 Motorway service areas – 2017 list values to be adopted

Unless there is rental evidence to the contrary, Valuation Officers should adopt £400 per single sided 6-sheet at motorway service areas.

4.9 Advertising from telephone boxes – 2017 list values to be adopted

Generally, 6-sheet advertising displays from telephone boxes should be dealt with by adopting the bus shelter scheme figures (See Paragraph 4.4 above)

4.9.1 “StreetTalk” telephone boxes - “stick on” or “wrap around” types

Valuation Officers should adopt £550 per telephone box.

4.9.2 “StreetTalk” telephone boxes - 6 sheets

Valuation Officers should adopt the bus shelter scheme figures per single sided 6-sheet on a telephone box. (See Paragraph 4.4 above)

4.9.3 “StreetTalk 6” kiosks - 6 sheet “scrollers”

StreetTalk 6 kiosks have a ‘cowl’ or ‘cover’ and a scrolling 6-sheet advertising display on the rear. It is understood that all have scrolling displays on the other side to the telephone cowl.

It is understood StreetTalk 6 Kiosks always have multiple scrolling display faces on one side, and a telephone under a ‘shelter’, ‘cover’ or ‘cowl’ on the other.

Valuation Officers should adopt the bus shelter scheme figures with the uplift for scrollers as appropriate. (See Paragraph 4.4 above).

StreetTalk 6 kiosks are generally located in town and city centres so the price to adopt is expected to be the “Town Centre” bus shelter price for the particular town or city.

There are a wide variety of display sign types and sizes in use on sponsored roundabouts, ranging from small “plaques” or “nameplates” up to the size of six-sheets. Typically there are four displays per roundabout; the actual number tends to depend on the size of the roundabout and the amount of roads feeding into it. This potential for variation makes it inappropriate to promote a single figure on sponsored roundabouts and instead a step-by-step approach is recommended as outlined in this paragraph. In addition, the main manual section at Rating Manual 5:20 provides guidance on how to identify and deal with various size of small format display.

The contractual arrangements between operators vary, but sponsored Roundabouts typically result from an arrangement between an authority with responsibility for the maintenance of a roundabout (or roundabouts) and another person. The authority responsible for roundabouts tend to see the revenue from advertising sponsorship as a way of contributing to the costs associated with maintaining its roundabout(s).

Whatever approach is considered appropriate, advertising on roundabouts on busy routes and with prominent and sizeable displays should be treated with care to ensure they are not valued at an insufficient level and, conversely, roundabouts with very small, permanent, tailor made “plaques” or “nameplates” should be carefully considered so they are not valued too highly. Where in doubt, advice should be sought from National Specialists Unit (NSU) following the current protocols as necessary.

4.10.1 Firstly, consider rental evidence

As a start point, Valuation Officers’ should examine rental evidence available. Where there is a rent paid either in respect of an individual roundabout, or for the ability to place sponsored advertising displays on more than one roundabout, it should be carefully considered and adjusted as appropriate to see if it offers a reliable indicator of value.

However, when making the first ever valuation of a particular advertising display based on the rent passing, care should be taken to adjust the rent to reflect the inevitable impact a newly imposed rate payment would have on it.

4.10.2 Secondly, where the accounts show there is potential for a profit, look for a ‘profit share’ or divisible balance

In the absence of a rent, where sufficient details are known to enable it, and the answer is positive, consider an approach that examines how much is left for rent after expenditure. In other words arrive at a divisible balance. In many cases there is a “profit share” arrangement between the council and operator in respect of sponsored roundabouts, and this is a good indication of the amount available from the divisible balance. Even where such an arrangement is in place and a payment is being made to the council, it may be necessary to arrive at a divisible balance separately.

For example, the VTE considered it appropriate in the 2010 list for York to apply such an approach; a divisible balance was calculated which, once divided, resulted in a valuation of £600 for a particular ‘roundabout’ (VTE Appeal Number 274118698930/538N10). When making the first ever calculation to reach the divisible balance, care should be taken to reflect the inevitable impact a newly imposed rate payment would have on it.

4.10.3 Finally, adopt the 2017 6-sheet “bus shelter” figures, adjusted as appropriate

In the absence of any rental evidence or where there is no “profit share” or divisible balance or where insufficient details enable a divisible balance to be determined, valuation officers’ should utilise the appropriate 6-sheet bus shelter figure specified in the table above. Caseworkers should adjust the appropriate 6-sheet bus shelter figure to take into account the display sizes and numbers of displays on the roundabout as appropriate.

For example, the VTE considered it appropriate in the 2010 lists for Suffolk to place one third of the prevailing bus shelter rate on 2 roundabouts containing signs measuring 90cm by 45cm (around 15% of the size of a six sheet). The prevailing bus shelter rate was £240, resulting in a valuation of £80 for each “roundabout” (VTE Appeal Number 353023683145/538N10). Such an approach would result in the following prices per roundabout displaying three or four signs of approximately that size:

Where sizes are significantly larger or smaller, adjustments should be made as mentioned above. For the sake of clarity, only the 6-sheet bus shelter figures should be used as the reference point. The 4-sheet bus shelter figures (or any other figures in this note) must not be used as a reference point.

4.11 Wider application of these figures - general

It is possible that the figures provided in this practice note will be taken and applied more widely to other small format displays. It is therefore important to re-iterate that the figures provided in this note are expressed in terms of single panels and may also include structure, planning and illumination costs as appropriate. They must never be used to value large format advertising displays, such as 48-sheets.

4.11.1 Bus shelter figures

Although wider use of the bus shelter figures given above is acceptable, it is important to consider “non-bus shelter” displays on their own merits. For instance any local rental and other evidence should be considered when making valuations in respect of “non-bus shelter” small format advertising panels and due account taken of location and positional differences.

4.11.2 Supermarket figures

The wider application of any figures provided in respect of supermarket panels is not recommended as they relate to named supermarkets only.

4.11.3 Petrol filling station forecourt figures

The wider application of the catch-all figure provided in respect of Petrol Station Forecourt panels is not recommended as it is by nature a broad scheme, subject to increase or reduction if rental evidence in the locality on similar forecourt display sites emerges. It is not considered likely that the forecourt figure will have any bearing on the figures used for bus shelters and superstores in the vicinity. However, if questions are raised regarding the differentials in value between panels in the same locality, the facts on the ground will need to be considered in each case. Care must be taken to ensure that a true comparison can be made before adjusting any figures, seeking advice following the current protocols as necessary.

4.11.4 Lampposts, motorway service areas, phone box and sponsored roundabout figures

The wider application of figures provided in respect of lampposts, motorway service areas, phone box and sponsored roundabouts is not recommended.

Appendix 1: advertising rights and advertising stations - relevant excerpts from legislation

1. Summary of relevant statutes currently in force

The relevant statutes in force at the time of writing and applicable to the treatment of advertising displays are as follows:

  • Local Government Finance Act 1988 (as amended) (LGFA 1988)

  • The Non-Domestic Rating (Alteration of Lists and Appeals) (England) Regulations 2009 (SI 2009/2268)

  • The Non-Domestic Rating (Alteration of Lists and Appeals) (Wales) Regulations 2005 (SI 2005/758 W63)

  • The Non-Domestic Rating (Miscellaneous Provisions) (No. 2) Regulations 1989 (SI 1989/2303)

  • Central Rating List (England) Regulations 2005 (SI 2005/551) (as amended)

  • Central Rating List (Wales) Regulations 2005 (SI 2005/422)

2. Detailed excerpts from relevant statutes

The following excerpts are correct at the time of publication. However, before using them for purposes such as preparation for valuation tribunal hearings, caseworkers are recommended to check whether there have been any subsequent amendments.

Section 64 (1), (2) and (11) and Section 65 (8) and (8A) of the LGFA 1988

64 Hereditaments

(1) A hereditament is anything which, by virtue of the definition of hereditament in section 115(1) of the 1967 Act, would have been a hereditament for the purposes of that Act had this Act not been passed.

(2) In addition, a right is a hereditament if it is a right to use any land for the purpose of exhibiting advertisements and—

1.the right is let out or reserved to any person other than the occupier of the land, or 2.where the land is not occupied for any other purpose, the right is let out or reserved to any person other than the owner of the land. (11) In subsection (2) above, “land” includes a wall or other part of a building and a sign, hoarding, frame, post or other structure erected or to be erected on land.

65 Owners and occupiers

(8) A right which is a hereditament by virtue of section 64(2) above shall be treated as occupied by the person for the time being entitled to the right.

(8A) In a case where— 1.land consisting of a hereditament is used (permanently or temporarily) for the exhibition of advertisements or for the erection of a structure used for the exhibition of advertisements, 2.section 64(2) above does not apply, and 3.apart from this subsection, the hereditament is not occupied, the hereditament shall be treated as occupied by the person permitting it to be so used or, if that person cannot be ascertained, its owner.

Paragraphs 15(1), (2) and (3) of Part 2 of The Non-Domestic Rating (Alteration of Lists and Appeals) (England) Regulations 2009 (SI 2009/2268)

15 Advertising rights

(1) Regulation 14 shall have effect, where the circumstances giving rise to the alteration are the coming into existence of an advertising hereditament, as if those circumstances occurred when—

1.any structure or sign is erected, after the right constituting the hereditament has been let out or reserved, to enable the right to be exercised; or 2.any advertisement is exhibited in pursuance of the right,

whichever is earlier; and such a hereditament shall be treated for the purposes of Part 3 of the Act as coming into occupation at that time.

(2) The erection, dismantling or alteration of any structure or sign for enabling the advertising right to be exercised, after the time mentioned in paragraph (1), shall be treated as a material change of circumstances for the purposes of a proposal made on the ground specified in regulation 4(1)(b) (rateable value inaccurate by reason of material change of circumstances occurring on or after the day on which the list was compiled).

(3) In this regulation—

“advertising hereditament” means a hereditament consisting of a right to which section 64(2) of the Act applies;

“advertising right” means a right which is such a hereditament; and

“structure” includes a hoarding, frame, post or wall.

Paragraphs 15(1), (2) and (3) of Part 2 of The Non-Domestic Rating (Alteration of Lists and Appeals) (Wales) Regulations 2005 (SI 2005/758 W63)

15 Advertising rights

(1) For the purposes of regulation 14 where the circumstances giving rise to the alteration are the coming into existence of an advertising hereditament those circumstances shall be treated as occurring when—

1.any structure or sign is erected, after the right constituting the hereditament has been let out or reserved, to enable the right to be exercised; or 2.any advertisement is exhibited in pursuance of the right,

whichever is earlier; and such a hereditament shall be treated for the purposes of Part 3 of the Act as coming into occupation at that time.

(2) The erection, dismantling or alteration of any structure or sign for enabling the advertising right to be exercised, after the time mentioned in paragraph (1), shall be treated for the purposes of a proposal made on the grounds set out in regulation 4(1)(b) as a material change of circumstances.

(3) In this regulation—

“advertising hereditament” means a hereditament consisting of a right to which section 64(2) of the Act applies;

“advertising right” means a right which is such a hereditament; and

“structure” includes a hoarding, frame, post or wall.

Paragraph 4 of The Non-Domestic Rating (Miscellaneous Provisions) (No. 2) Regulations 1989 (SI 1989/2303)

4 Advertising rights, etc.

(1) In relation to an advertising hereditament, in applying the provisions of sub-paragraphs (1) to (7) of paragraph 2 of Schedule 6 to the Act it shall be assumed that the grant or reservation of the right of which the hereditament consists included the grant or reservation of a right to use any structure or sign for the time being available for use for the purpose of exhibiting advertisements by the occupier of that hereditament, notwithstanding that the structure or sign was provided by that occupier or was provided after the making of the grant or reservation concerned.

(2) In arriving at an amount of estimated rent under paragraph 2(1), (1A) or (1B) of Schedule 6 to the Act in respect of any land (within the meaning of section 64(2) of the Act) over which an advertising right is exercisable, no account shall be taken of any value or, as the case may be, increased value arising from the use of the land for the purpose of exhibiting advertisements in accordance with that right.

(3) Where any hereditament rateable in respect of its occupation for other purposes is used temporarily or permanently for, or for the erection thereon or attachment thereto of any structure used for, the exhibition of advertisements other than in pursuance of an advertising right, in arriving at an amount under paragraph 2(1), (1A) or (1B) of Schedule 6 in respect of that hereditament the increased value from that use of the hereditament shall be taken into account.

(4) In this regulation—

“advertising hereditament” means a hereditament consisting of a right to which section 64(2) of the Act applies; and

“advertising right” means a right which is such a hereditament, and

“structure” includes a hoarding, frame, post or wall.

Parts 6 and 16 of Central Rating List (England) Regulations 2005 (SI 2005/551) (as amended) (England)

6 Railway hereditaments

(1) Where Network Rail Infrastructure Limited—

  1. occupies or, if it is unoccupied, owns any hereditament; or
  2. lets or licenses a hereditament to—

(i) a licence holder or a licence exempt operator, other than a licence holder or licence exempt operator who is also a designated person under Parts 1 or 2 of the Schedule to these Regulations or under Part 2 of the Schedule to the Non-Domestic Rating (Communications and Light Railways) (England) Regulations 2005, and the lessee, licensee or British Transport Police Authority occupies, or, if unoccupied, owns the hereditament; or

(ii) the British Transport Police Authority, and it occupies, or, if unoccupied, owns the hereditament, and if, apart from these Regulations, those hereditaments would be more than one hereditament, and each separate hereditament satisfies the conditions in paragraph (3), those separate hereditaments shall be treated as one hereditament.

(2) Where London Underground Limited—

1.occupies or, if it is unoccupied, owns any hereditament; or 2.lets or licenses a hereditament to any person (other than a licence holder or licence exempt operator who is also a designated person under Parts 1 or 2 of the Schedule to these Regulations), and if, apart from these Regulations, those hereditaments would be more than one hereditament, and provided each separate hereditament satisfies the conditions in paragraph (3), those separate hereditaments shall be treated as one hereditament.

(3) The conditions mentioned in paragraphs (1) and (2) are that the hereditament is—

  1. used wholly or mainly for -

(i) in the case of Network Rail Infrastructure Limited, railway purposes;

(ii) in the case of London Underground Limited, LUL purposes; and

  1. not an excepted hereditament.

(4) In this regulation—

“EEA State” means a member State, Norway, Iceland or Liechtenstein;

“excepted hereditament” means a hereditament consisting of or comprising—

  1. premises used as a shop, hotel, museum or place of public refreshment;
  2. premises used wholly or mainly as office premises, where those premises are not situated on the operational land of—

(i) any person designated by regulation 3 and named in Part 1 of the Schedule;

(ii) a licence exempt operator or licence holder;

  1. premises or rights so let out as to be capable of separate assessment, other than those falling within paragraph (1)(b) or (2)(b); or
  2. premises (other than premises used in connection with the collection and delivery of parcels, goods or merchandise conveyed or to be conveyed by rail) used wholly or in part for purposes concerned with—

(i) the carriage of goods or passengers by road transport or sea transport; or

(ii) harbours,

Or for purposes incidental to such purposes;

“licence exempt operator” and “licence holder” have the meanings given by section 10(6) and 83(1) respectively of the Railways Act 1993 except that “licence holder” also includes a holder of a European licence granted pursuant to the Railway (Licensing of Railway Undertakings) Regulations 2005 or pursuant to any action taken by an EEA State for the purpose of implementing Council Directive 1995/18/EC dated 19th June 1995 on the licensing of railway undertakings, as amended by Directive 2001/13/EC dated 26th February 2001 and Directive 2004/49/EC dated 29th April 2004, both of the European Parliament and of the Council;

“LUL purposes” means the purposes of the parts of LUL’s undertaking which are concerned with the carriage of goods or passengers by rail, or for purposes ancillary to those purposes (including the purpose of the exhibiting of advertisements); and

“railway purposes” means the purposes of providing railway services, within the meaning given by section 82(1) of the Railways Act 1993, or for purposes ancillary to those purposes (including the purposes of providing policing services or the exhibiting of advertisements).

(5) The hereditaments described in paragraphs (1) and (2) will be treated as occupied by the designated person.

16 Canal hereditaments

(1) Where a company which is a designated person by virtue of regulation 3(1) and Part 11 of the Schedule occupies or, if it is unoccupied, owns any hereditament which—

1.comprises—

(i) waterways (including cuts and culverts, locks, gates, sluices, pumps, flood let-off valves, feeders, conduits, weirs, side ponds, ditches and drains);

(ii) aqueducts, basins, bridges, embankments, reservoirs and tunnels;

(iii) lighthouses, beacons, buoys, breakwaters, boatlifts and other structures designed to aid navigation;

(iv) docks, wharves, piers, jetties, pontoons, moorings, slipways, land and buildings used for the building, maintenance or floating storage of craft, or for the provision, maintenance or servicing of inland waterways and plant or machinery used in connection therewith;

(v) clay pits, dredging or other waste disposal tips; or

(vi) other land, buildings or structures or parts of buildings or structures used for the provision or servicing of facilities for traffic by, public access to, or enjoyment of, inland waterways, or for ancillary purposes; and

1.is not an excepted hereditament then if, apart from these Regulations, those hereditaments would be more than one hereditament, those separate hereditaments shall be treated as one hereditament.

(2) In paragraph (1)—

“excepted hereditament” means any hereditament—

  1. consisting of or including a dock or harbour undertaking carried on under authority conferred by or under any enactment;
  2. consisting of premises so let out as to be capable of separate assessment;
  3. consisting of office premises, where those premises are not situated on operational land of the designated person; or
  4. consisting of a car park used wholly or mainly in connection with office premises, where those premises are not situated on operational land of the designated person; and “inland waterway” means any such waterway, whether natural or artificial.

(3) The hereditament described in paragraph (1) shall be treated as occupied by the relevant designated person.

Parts 7, and 16 of Central Rating List (Wales) Regulations 2005 (SI 2005/422) (Wales)

7 Railway hereditaments

(1) Where Network Rail Infrastructure Limited, which is a designated person by virtue of being listed in Part 1 of the Schedule—

1.occupies or, if it is unoccupied, owns any hereditament; or 2.lets or licenses a hereditament to—

(i) a licence holder or a licence exempt holder and the lessee, licensee or the British Transport Police Authority occupies, or, if unoccupied, owns the hereditament; or

(ii) the British Transport Police Authority and it occupies, or, if unoccupied, owns the hereditament, and if, apart from these Regulations, those hereditaments would be more than one hereditament and provided each separate hereditament satisfies the conditions in paragraph (2), those separate hereditaments will be treated as one hereditament.

(2) The conditions mentioned in paragraph (1) are that the hereditament is—

  1. used wholly or mainly for railway purposes; and
  2. not comprised in an excepted hereditament.

(3) In this regulation—

“EEA State” means a member State, Norway, Iceland or Liechtenstein;

“excepted hereditament” means a hereditament consisting of or comprising—

  1. premises used as a shop, hotel, museum or place of public refreshment;
  2. premises used wholly or mainly as office premises, where those premises are not situated on the operational land of—

(i) any person designated by regulation 4 and named in Part 1 of the Schedule;

(ii) a licence exempt operator or licence holder;

  1. premises or rights so let out as to be capable of separate assessment, other than those falling within paragraph (1)(b); or
  2. premises (other than premises used in connection with the collection and delivery of parcels, goods or merchandise conveyed or to be conveyed by rail) used wholly or in part for purposes concerned with—

(i) the carriage of goods or passengers by road transport or sea transport; or

(ii) harbours,

Or for purposes incidental to such purposes;

“licence exempt operator” and “licence holder” have the meanings given by section 10(6) and 83(1) respectively of the Railways Act 1993 except that “licence holder” also includes a holder of a European licence granted pursuant to the Railway (Licensing of Railway Undertakings) Regulations 2005 or pursuant to any action taken by an EEA State for the purpose of implementing Council Directive 1995/18/EC dated 19th June 1995 on the licensing of railway undertakings, as amended by Directive 2001/13/EC dated 26th February 2001 and Directive 2004/49/EC dated 29th April 2004, both of the European Parliament and of the Council; and

“railway purposes” means the purposes of providing railway services, within the meaning given by section 82(1) of the Railways Act 1993, or for purposes ancillary to those purposes (including the purposes of providing policing services or the exhibiting of advertisements).

(4) The hereditament described in paragraph (1) will be treated as occupied by the designated person.

16 Canal hereditaments

(1) Where a company which is a designated person by virtue of being listed in Part 10 of the Schedule occupies or, if it is unoccupied, owns any hereditament which—

1.comprises—

(i) waterways (including cuts and culverts, locks, gates, sluices, pumps, flood let-off valves, feeders, conduits, weirs, side ponds, ditches and drains);

(ii) aqueducts, basins, bridges, embankments, reservoirs and tunnels;

(iii) lighthouses, beacons, buoys, breakwaters, boatlifts and other structures designed to aid navigation;

(iv) docks, wharves, piers, jetties, pontoons, moorings, slipways, land and buildings used for the building, maintenance or floating storage of craft, or for the provision, maintenance or servicing of inland waterways and plant or machinery used in connection therewith;

(v) clay pits, dredging or other waste disposal tips; or

(vi) other land, buildings or structures or parts of buildings or structures used for the provision or servicing of facilities for traffic by, public access to, or enjoyment of, inland waterways, or for ancillary purposes; and

  1. is not an excepted hereditament then if, apart from these Regulations, those hereditaments would be more than one hereditament, those separate hereditaments shall be treated as one hereditament.

(2) In paragraph (1)—

“excepted hereditament” means any hereditament—

  1. consisting of or including a dock or harbour undertaking carried on under authority conferred by or under any enactment;
  2. consisting of premises so let out as to be capable of separate assessment;

  3. consisting of office premises, where those premises are not situated on operational land of the designated person; or

4 .consisting of a car park used wholly or mainly in connection with office premises, where those premises are not situated on operational land of the designated person; and “inland waterway” means any such waterway, whether natural or artificial.

(3) The hereditament described in paragraph (1) shall be treated as occupied by the relevant designated person.

Practice note 1: 2010 advertising rights and advertising stations

small format 4-sheet and 6-sheet displays, including those on bus shelters and at supermarkets

1. Co-ordination arrangements

This is a Group Class. Co-ordination responsibilities are set out in Rating Manual section 6 part 1, and the 2010 Co-ordination Practice Note

For advertising displays and hoardings in general, the available Special Category Codes are:

003 (Advertising Right or Station), and

146 (Land Used for Advertising).

For 4-sheet and 6-Sheet bus shelter panels and 6-sheet panels at supermarkets, Special Category Code 003 (Advertising Right or Station) should be used.

As a Group Class, the appropriate suffix letter is G.

2. Introduction and scope of this practice note

In general, the approach detailed in Rating Manual section 6 part 3 - section 20 should be adopted when making valuations in respect of advertising rights or stations, and land used for advertising.

This Practice Note concentrates on small format 4-sheet and 6-sheeet displays, in particular bus shelter, petrol filling station and supermarket advertising displays, which are typically represented by 6-sheet panels.

Discussions have taken place with Clear Channel UK Ltd in respect of the levels of value to be applied for the Revaluation 2010 for 6-sheet panels on bus shelters.

Available evidence of rents on small display advertising has also been examined. Similarly, bus shelter and small format advertising has been considered in the context of more general advertising industry indicators and trends.

Additionally, this note provides advice for Revaluation 2010 on the approach to be taken in respect of 6-sheet advertisements at superstores, petrol filling stations, motorway service areas, sponsored roundabouts and lampposts displays.

The figures in this note must not be used for any display sizes larger than the modern 6-sheet, being 1.8m x 1.2m.

3. An overview of the outdoor advertising industry April 2003 – April 2008

According to the Outdoor Advertising Association, outdoor and transport advertising in April 2008 enjoyed around a 5.8% share of the total advertising spend in the UK; this share has steadily increased from around 4.3% in 1998, reaching 5.3% in 2003. This increase in market share in 2008, together with an increase in total UK advertising spend of around 7%, resulted in a 30%-32% increase in spend on outdoor and transport advertising over the five year period. When transport (advertisements on public transport networks and vehicles) is removed from the figures, the increase in outdoor spend alone is around 39%.

The use of outdoor advertising displays has changed and evolved over this period, the overall number of displays increasing by some 15% between 2003 and 2008.

Over the period April 2003 to April 2008:

The proliferation of the 4-sheet has declined, with just 30% of their 2003 total remaining in 2008. The 4-sheets displayed in 2008 represents less than 1% of all display types (3% in 2003)

The proliferation of the 6-sheet shows a 26% increase over the period, now representing some 60% of the displays in the outdoor market.

Additionally, and strictly speaking outside the scope of this practice note:

The actual number of 48-sheets has dropped between 2003 as 2008, currently representing around 19% of all display types.

The actual number of 96-sheet displays reduced by 20% from 2003 to 2008; they represent less than 2.6% of all displays.

“Others”, including “Banners” (large fabric type displays), spectaculars and bespoke formats have become much more prevalent by 2008, their incidence trebling from 2003 to 2008. These are becoming a bigger proportion of the whole market for outdoor advertising, representing 17.25% of all displays in 2008 (6.4% in 2003).

The future beyond April 2008

The second quarter of 2008 has shown a slight levelling in total spend on advertising, which may mark the first tangible effect of the so-called “credit crunch” on the advertising industry as a whole. However, “Outdoor” appears to be holding its own as a share of total spend.

As “Outdoor Advertisers” tend to rent sites on short-term licences and informal agreements, which are much more flexible than an upwards only FRI lease, options to terminate or renegotiate rental agreements can in theory be exercised relatively quickly as a response to difficult conditions. Whether, or the extent to which, 2008’s economic events affect the “outdoor advertising landscape” remains to be seen over coming years.

4. Bus shelter locations

Guidance on the categorisation of any particular town and city and the relative location classifications within that town and city is given below. The basis of classification remains as adopted for earlier Rating Lists; the general expectation is therefore that categorisation and classification adopted for R2005 will apply for R2010.

4.1. Categorisation of towns / cities

The scheme of valuation identifies four urban categories:

Central London (excluding certain “key higher value” locations, e.g. Oxford Street)

Cities and outer London Boroughs

Major towns

Other towns

In the majority of cases it should be straightforward to decide upon the most appropriate category and classification to adopt for any particular bus shelter location.

However, regard may be had to additional factors such as population size, any local restrictions on advertising, whether “Heritage” Centres and whether the shelter is in a Historic City or Town. These factors may have a bearing on the categorisation/classification decision to be made.

Central London

The relative categorisations within Central London are now well established and these remain unchanged for 2010 purposes.

Within Central London, the “key higher value” locations are excluded from the scope of this practice note and values are not provided. This repeats the approach taken in previous revaluations. It is therefore envisaged that the Groups responsible for “key higher value” locations in Central London will establish and apply appropriate levels of value depending on the relative merits of the locations concerned.

Cities, outer London boroughs, major towns and other towns

For 2010, determining the correct categorisation of any city or town is again most important. It is however envisaged that the work completed by Groups during maintenance of the 2005 lists will have established the relative strengths and the therefore the appropriate categorisation of Cities, Boroughs and Towns from an advertising perspective.

It is already established that some “Cities” could be more appropriately categorised as “Major Towns” and, conversely, some “Major Towns could be categorised as “Cities”.

4.2. Classification within towns / cities

Within each of the four “urban Categories” above, the scheme of valuation identifies three locations:

  • town centre
  • main roads
  • other locations

It is important to build on the valuable work already done in determining the relative strengths of advertising position and not revisit this area unnecessarily.

Town centre

This should be taken as meaning the main central shopping and commercial centre of the particular conurbation concerned.

Main roads

The majority of bus shelter sites falling into this classification are likely to be situated on main roads. Main road locations should include the principal commuter routes into the city/town centre, the main arterial routes, the main suburban high streets and certain high volume locations such as the approach road to a major superstore.

Other locations

These will include feeder roads, minor roads, residential suburbs and estates, This classification is also likely to encompass neighbourhood and small local “estate type” shopping centres.

5. Data capture and the Rating Support Application

Advertising Displays are now a class offered valuation support on the VOA Rating Support Application.

The current edition of the “VSA Standards” document and also any relevant standard valuation scale scope document should be followed when approaching the data capture of advertising displays.

Following data capture into RSA and for the purposes of the 2005 list onwards, small format advertising displays are referred to in terms of “single-sided” 4-sheet or “single-sided” 6-sheet panels.

Small format displays must be captured for RSA in terms of single sheet panels.

Consequently, all values shown in this practice note are expressed in terms of single-sheet panels.

6. Structure, planning and illumination

All figures provided in this Practice Note reflect costs for structure, planning and illumination as appropriate.

Where valuation officers obtain rental information in respect of advertising rights, care must be taken to adjust such rents by an appropriate amount depending on the type of display; costs must be amortised and added to the rent as appropriate. This is how the 2010 valuation schemes in respect of the majority of larger format advertising displays would be expected to operate.

However, when formulating 2010 valuation schemes for small format advertising displays and where the figures are taken from this note, it is recommended that separate matrices be created for bus shelter, supermarket, lamppost, petrol filling station, motorway service areas and sponsored roundabouts as appropriate that reflect these features. For such small format schemes, it is important that the matrix description state, “All prices in this valuation scheme include structure, planning fees and/or illumination” or something to that effect.

7. Bus shelter displays – 2010 list values to be adopted

The vast majority of advertising panels at bus shelters are displayed as 6-sheets, the typical format being double-sided, 6-sheet displays.

A small number of 4-sheet panels still remain, however as the figures provided in the “Overview” at paragraph 3 suggest, these are being gradually removed and/or, if considered viable, replaced with 6 sheet panels.

7.1. Bus shelter 6-sheet panels

For bus shelter 6-sheet panels, the following values, expressed in terms of a single 6-sheet panel, should be adopted:

2010 List Values: Bus Shelters

6-Sheet Panels (£/single panel)

Town Centre (£)

Main Roads (£)

Other

Central London (Excluding Certain “Key Locations”, such as Oxford Street).

1000

600

350

Cities and Outer London Boroughs

550

400

225

Major Towns

400

300

200

Other Towns

325

240

150

7.2. Bus shelter 4-sheet panels

In the absence of any local evidence to the contrary, any remaining bus shelter 4-sheet panels should be valued on the following basis, expressed in terms of a single 4-sheet panel:

2010 List Values: Bus Shelters

4-Sheet Panels (£/single panel)

Town Centre (£)

Main Roads (£)

Other (£)

Cities (including London but not London key locations as defined above in chapter 4.1)

170

125

85

Major Towns

135

95

75

Other Towns

100

80

60

8. Bus shelter displays – other considerations

Other features that may need consideration when dealing with the valuation of bus shelter advertising displays are considered in the following paragraphs. Advice is also given on aspects of data capture and rating list address creation.

8.1. Bus shelters with additional static panels

In respect of those bus shelters that have more than the standard “double 4-sheet” or “double 6-sheet” static display panels, the following approach, which replicates that taken during the 2005 Rating List maintenance, should be adopted for 2010.

For bus shelters containing more than one double panel or two single panels, it is accepted that in most cases the additional static panels do not have the same value as the first two static panels. In such cases the subsequent static panels should be valued at 50% of the appropriate single panel price.

For example:

Where the single 6-sheet panel is £550, the third and any subsequent static panel should be taken at £275 each, being 50% of £550.

There may however be some exceptional cases where this reduced rate for third and further additional panels would not apply. For example, where a bus shelter is situated outside an underground or railway station, and where the additional static panels are specifically sited to attract the pedestrians going into and out of the station.

Each case should be judged on its own merits but in these exceptional cases, any additional static panels are expected to be valued at the same single sheet rate as the first two single panels. In other words, additional panels in exceptionally good locations typically attract no discount.

8.2. Bus shelters with scrollers

Some bus shelters display multi‑scrolling 6-sheet panels. Such scrollers tend to be located in the more prominent locations and normally display 2, 3 or 4 sheets per panel face.

The scrolling panel usually has a static display panel on the rear side. It is rare to have two scrollers “back-to-back”.

In respect of bus shelters that have scrollers, the appropriate single sheet rate should be applied to each scrolling face with no discount.

8.3. Bus shelters with electronic displays

Using what is a relatively new and improving format, some bus shelters incorporate electronic media to display advertisements on 6-sheet panels. Such displays are not very common as at the AVD, but are steadily increasing in number. As they are quite expensive to produce, they tend to be located in the more prominent locations offer the equivalent of 6 sheets per panel face in terms of their ability to be placed in “packages”.

The electronic panel may have a static display panel on the rear side. They are not as bulky as scrollers, so there may also be situations where there are two electronic panels “back-to-back”.

In respect of bus shelters that have electronic displays, six times the appropriate single sheet rate should be applied with no discount.

8.4. Bus shelter identification and address creation

Address capture protocols must be followed when creating addresses for advertising hereditaments in the Rating Support Application (RSA).

All operators of bus shelter adverting adopt some kind of identification system and typically each bus shelter has a unique reference number displayed somewhere on the shelter. These can be numerical or alphanumerical; it should be noted in all cases and wherever possible incorporated in the rating list addresses.

This unique identification reference number is normally located on the top corner of the bus shelter, facing the road. It is typically an 8-digit number, but could be any length.

The inclusion of the site number in the Rating List address will greatly assist the identification of the site, both by the VOA and the Advertising Company.

In future and wherever possible, caseworkers are reminded to include the site number in the address when bringing any new bus shelter advertising sites into the Rating List. This also applies when altering the list following the settlement of proposals or when dealing with list maintenance work in general.

9. Supermarket 6-sheet panels – 2010 list values to be adopted

For the purposes of this paragraph, superstores include large hypermarkets and supermarkets and modern stand alone superstores with significant parking provision. The figures shown below should not be used in respect of 6-sheet advertising at traditional convenience stores located in a parade of local shops, or convenience stores at petrol filling stations.

Refer to paragraph 11 for lamppost advertising in retail car parks.

The values to be adopted for 6-sheet panels displayed at superstores are dependent on the named operator of the store. Where details are known, the terms of licence agreements between the supermarkets and the advertising company remain unchanged following renewal. This is thought to be mainly due to the “profit-share” elements built into the arrangements on top of the base rent figures.

It has been established that both Tesco and Sainsbury retain specific rights to use panels themselves for a percentage of the time. This percentage is specified in the licence agreements and is a “retained right”; therefore in these circumstances it is not correct to value these individual panels at a level reflecting the right to advertise for 100% of the time.

In practice, those supermarkets having retained rights tend to use a particular number of panels, but not necessarily the same panels, at any one time. The combination of panels used by the supermarket appears to be agreed between the parties with due consideration for position, duration etc.

The “adjusted figures” recommended below for the main supermarkets take account of the percentage of advertising time retained by Tesco and Sainsburys, and this percentage remains unchanged from the 2005 list.

Two sets of figure are therefore provided. The first set of figures represents the full value of a standard 6-sheet panel at any particular supermarket. However, it is the second set of figures that must be adopted in the valuation of each single 6-sheet panels at the particular supermarkets mentioned. The figures only differ where the host is known to reserve advertising time.

In respect of applying figures more widely, attention is also drawn to the guidance provided in Section 14 below.

The figures provided below are expressed in terms of single-panel 6-sheet.

2010 List Figures: Supermarkets

6-Sheet Panels (£/single panel)

Unadjusted figure (£)

Adjusted figure to be adopted (£)

Kwiksave*

500

500

Co-op*

650

650

Somerfield*

650

650

Morrison*

800

800

Asda*

1050

1050

Waitrose*

1200

1200

Tesco

1200

1000

Sainsburys

1200

800

*It will be noted that the “Unadjusted” and “Adjusted” figures are exactly the same for these supermarkets, as it is understood that the licences for these supermarkets do not specifically retain within their control any part of the right to display.

10. Petrol filling station forecourt panels – 2010 list values to be adopted

Central guidance is provided in respect of 6-sheet panels displayed at petrol filing station forecourts. Available rental information indicates that around 85% of forecourt advertising displays can be valued by reference to a single figure.

This means 85% of 6-sheet displays are located on stand-alone petrol filling station forecourts on classified A and B roads in urban and suburban locations.

2010 List Figures: Petrol Station Forecourt

6-Sheet Panels (£/single panel)

Figure (£)

Expected national percentage of petrol stations where the figures are expected to apply

Premium locations: Trunk Roads and “honey pot” locations such as sports venues and stadiums, concert halls and near large regional shopping centres.

475

10%

Majority of locations: All classified A & B Roads, urban and suburban locations on main traffic routes.

350

85%

Remote locations: Country Lanes and villages.

200

5%

If rental information becomes available in support of any challenge to the application of the above figures, full details of the rent must be ascertained and further advice sought using the protocols for seeking advice as appropriate.

In respect of applying figures more widely, attention is also drawn to the guidance provided in Section 14 below.

11. Lamppost advertising on 6-sheets – 2010 values to be adopted

Over recent years, double sided 6-sheet advertising displays mounted within the vertical structure of lampposts have appeared, initially operated predominantly by a company called Streetbroadcast that ceased trading in 2009. The agreement under which it used to operate was similar to that which operates in respect of bus shelter advertising, in that the local authority is provided with new lampposts in exchange for the right to advertise on them being granted to Streetbroadcast.

The panels are typically two and a half to three metres above ground level. Streetbroadcast not only displayed advertising on in roadside locations, but also displayed 6-sheet advertising on lampposts and poles within shopping centre and retail park car parks.

Since 2009, some of the former Streetbroadcast sites have been bought and operated by other companies.

11.1. Lampposts on roadside locations in towns and cities

Since Streetbroadcast ceased trading, the companies operating remaining sites have demonstrated that the revenue potential and therefore rental value of lamppost 6-sheet advertising on roadside is not on “all fours” with bus shelter advertising at the antecedent valuation date.

The following values are recommended in respect of 2010 valuations in the absence of any better evidence of value derived from an analysis of rental or other direct comparable evidence.

2010 List Figures: Lamppost Advertising on Roadside: 6-Sheet Panels (£/single panel)

Figure (£)

Cities and Towns where it is anticipated the respective figures apply

Central London (Excluding Certain “Key Locations”, such as Oxford Street)

250

Cities and Outer London Boroughs

175

For example, Leeds and Coventry

Major Towns

150

For example, Rochdale, Newport, Oldham, Hartlepool

Other Towns

125

Ashby de-la Zouch, Devizes

The considerations made when determining the correct categorisation of “City” or “Town” as described in the left hand column of the table are the same as those made in respect of the bus shelter scheme.

11.2. Lampposts in shopping centre and similar retail car parks

Where 6-sheet panel advertising rights are identified on lampposts in shopping centre and retail park car parks, available rental details should be obtained, adjusted, analysed and adopted as appropriate. However, in the absence of rental evidence, the figures shown in the table below should be adopted.

2010 List Figures: Lamppost Advertising in Shopping Centre and similar Retail Car Parks: 6-Sheet Panels (£/single panel)

Figure (£)

Locations where the respective figures apply (and anticipated %age of parks)

Within the M25 (Excluding Central London, being Westminster, City, Camden, Kensington and Chelsea)

250

Also applies to major out of town shopping centres outside the M25, such as Bluewater, Lakeside, Cribbs Causeway, Trafford Park, Meadowhall, Merry Hill and the Metro Centre.

(20% of parks are anticipated to fall into this category)

Outside the M25 in England and Wales – Normal

215

Most locations outside the M25.

(70% of parks are anticipated to fall into this category)

Outside the M25 in England and Wales – Poorer

140

Where the rental level paid to shopping centre landlords is demonstrably below £100/panel in Late 2010.

(10% of parks are anticipated to fall into this category)

Where there is any difficulty determining those situations at the boundary of the “Normal” and “Poorer” categories outside the M25, guidance from CEO (Rating) should be sought using the usual protocols.

The figures provided for supermarkets at paragraph 9 should not be used to value lamppost 6-sheets, as they relate to named supermarkets only.

Figures for 4-sheet advertising displays are not provided as they rarely constitute the type of lamppost advertising display intended to be dealt with in this paragraph. Therefore, should it become necessary to place a value a 4-sheet (or any other) display on a lamppost, guidance should be sought from CEO (Rating) using the usual protocols.

12. Motorway service areas – 2010 list values to be adopted

Unless there is rental evidence to the contrary, Valuation Officers should adopt £300 per single sided 6-sheet at motorway service areas.

12A. Advertising from telephone boxes – 2010 list values to be adopted

Generally, 6-sheet advertising displays from telephone boxes should be dealt with by adopting the bus shelter scheme figures (See Paragraphs 7 and 8 above).

12A.1 “StreetTalk” BT telephone boxes - “stick on” or “wrap around” types

Valuation Officers should adopt £500 per telephone box.

12A.2 “StreetTalk” BT telephone boxes - 6 sheets

Valuation Officers should adopt the bus shelter scheme figures per single sided 6-sheet on a telephone box. (See Paragraphs 7 and 8 above)

12A.3 “StreetTalk 6” kiosks - 6 sheet “scrollers”

StreetTalk 6 kiosks have a ‘cowl’ or ‘cover’ and a scrolling 6-sheet advertising display on the rear. It is understood that all have scrolling displays on the other side to the telephone cowl.

It is understood StreetTalk 6 Kiosks always have multiple scrolling display faces on one side, and a telephone under a ‘shelter’, ‘cover’ or ‘cowl’ on the other.

Valuation Officers should adopt the bus shelter scheme figures with the uplift for scrollers as appropriate. (See Paragraphs 7 and 8 above).

StreetTalk 6 kiosks are generally located in town and city centres so the price to adopt is expected to be the “Town Centre” bus shelter price for the particular town or city.

There are a wide variety of display sign types and sizes in use on sponsored roundabouts, ranging from small “plaques” or “nameplates” up to the size of six-sheets. Typically there are four displays per roundabout; the actual number tends to depend on the size of the roundabout and the amount of roads feeding into it. This potential for variation makes it inappropriate to promote a single figure on sponsored roundabouts and instead a step-by-step approach is recommended as outlined in this paragraph. In addition, the main manual section at Rating Manual 5:20 provides guidance on how to identify and deal with various size of small format display.

The contractual arrangements between operators vary, but sponsored Roundabouts typically result from an arrangement between an authority with responsibility for the maintenance of a roundabout (or roundabouts) and another person. The authority responsible for roundabouts tend to see the revenue from advertising sponsorship as a way of contributing to the costs associated with maintaining its roundabout(s).

Whatever approach is considered appropriate, advertising on roundabouts on busy routes and with prominent and sizeable displays should be treated with care to ensure they are not valued at an insufficient level and, conversely, roundabouts with very small, permanent, tailor made “plaques” or “nameplates” should be carefully considered so they are not valued too highly. Where in doubt, advice should be sought from National Specialists Unit (NSU) following the current protocols as necessary.

13.1 Firstly, consider rental evidence

As a start point, Valuation Officers’ should examine rental evidence available. Where there is a rent paid either in respect of an individual roundabout, or for the ability to place sponsored advertising displays on more than one roundabout, it should be carefully considered and adjusted as appropriate to see if it offers a reliable indicator of value.

However, when making the first ever valuation of a particular advertising display based on the rent passing, care should be taken to adjust the rent to reflect the inevitable impact a newly imposed rate payment would have on it.

13.2 Secondly, where the accounts show there is potential for a profit, look for a ‘profit share’ or divisible balance

In the absence of a rent, where sufficient details are known to enable it, and the answer is positive, consider an approach that examines how much is left for rent after expenditure. In other words arrive at a divisible balance. In many cases there is a “profit share” arrangement between the council and operator in respect of sponsored roundabouts, and this is a good indication of the amount available from the divisible balance. Even where such an arrangement is in place and a payment is being made to the council, it may be necessary to arrive at a divisible balance separately.

For example, the VTE considered it appropriate in the 2010 list for York to apply such an approach; a divisible balance was calculated which, once divided, resulted in a valuation of £600 for a particular ‘roundabout’ (VTE Appeal Number 274118698930/538N10). When making the first ever calculation to reach the divisible balance, care should be taken to reflect the inevitable impact a newly imposed rate payment would have on it.

13.3 Finally, adopt the 2010 6-sheet “bus shelter” figures, adjusted as appropriate

In the absence of any rental evidence or where there is no “profit share” or divisible balance or where insufficient details enable a divisible balance to be determined, valuation officers’ should utilise the appropriate 6-sheet bus shelter figure specified in the table above. Caseworkers should adjust the appropriate 6-sheet bus shelter figure to take into account the display sizes and numbers of displays on the roundabout as appropriate.

For example, the VTE considered it appropriate in the 2010 lists for Suffolk to place one third of the prevailing bus shelter rate on 2 roundabouts containing signs measuring 90cm by 45cm (around 15% of the size of a six sheet). The prevailing bus shelter rate was £240, resulting in a valuation of £80 for each “roundabout” (VTE Appeal Number 353023683145/538N10). Such an approach would result in the following prices per roundabout displaying three or four signs of approximately that size:

2010 List Values: Sponsored Roundabout Advertising (3 or 4 display signs measuring approximately 90cm x 45cm)

Town Centre (£)

Main Roads (£)

Other

Central London (Excluding Certain “Key Locations”, such as Oxford Street).

330

200

115

Cities and Outer London Boroughs

180

130

75

Major Towns

130

100

65

Other Towns

110

80

50

Where sizes are significantly larger or smaller, adjustments should be made as mentioned above. For the sake of clarity, only the 6-sheet bus shelter figures should be used as the reference point. The 4-sheet bus shelter figures (or any other figures in this note) must not be used as a reference point.

14. Wider application of these figures - general

It is possible that the figures provided in this practice note will be taken and applied more widely to other small format displays. It is therefore important to re-iterate that the figures provided in this note are expressed in terms of single panels and may also include structure, planning and illumination costs as appropriate. They must never be used to value large format advertising displays, such as 48-sheets.

14.1. Bus shelter figures

Although wider use of the bus shelter figures given above is acceptable, it is important to consider “non-bus shelter” displays on their own merits. For instance any local rental and other evidence should be considered when making valuations in respect of “non-bus shelter” small format advertising panels and due account taken of location and positional differences.

14.2. Supermarket figures

The wider application of any figures provided in respect of supermarket panels is not recommended as they relate to named supermarkets only.

14.3. Petrol filling station forecourt figures

The wider application of the catch-all figure provided in respect of Petrol Station Forecourt panels is not recommended as it is by nature a broad scheme, subject to increase or reduction if rental evidence in the locality on similar forecourt display sites emerges. It is not considered likely that the forecourt figure will have any bearing on the figures used for bus shelters and superstores in the vicinity. However, if questions are raised regarding the differentials in value between panels in the same locality, the facts on the ground will need to be considered in each case. Care must be taken to ensure that a true comparison can be made before adjusting any figures, seeking advice following the current protocols as necessary.

14.4. Lampposts, motorway service areas, phone box and sponsored roundabout figures

The wider application of figures provided in respect of lampposts, motorway service areas, phone box and sponsored roundabouts is not recommended.