Licensed sports, social and private members’ clubs
This publication is intended for Valuation Officers. It may contain links to internal resources that are not available through this version.
This section deals with premises occupied by Licensed Sports, Social and Private Members’ Clubs excluding casinos and gaming clubs (see Rating Manual section 6 part 3: section 210); church clubs and community centres (see Rating Manual section 6 part 3: section 475); discotheques and night clubs (see Rating Manual section 6 part 3: section 720) and sports grounds and clubs (see Rating Manual section 6 part 3: section 970). Snooker Halls & Clubs (see Rating Manual section 6 part 3: section 945).
1.1 Definitions
In general, Licensed Sports, Social and Private Members’ Clubs will fall within one or other of the following categories:
a.Members’ Clubs, or (private members clubs) where the management is vested in the body of members, or trustees acting on behalf of the members, or an elected committee and include political, sports and social clubs (excluding sports clubhouses). Such clubs may be unincorporated or incorporated under the Companies Acts; workingmen’s or similar clubs registered under the Friendly Societies Acts or the Industrial and Provident Societies Acts. These subdivisions are in themselves unimportant. What is important is that a members’ club is carried on for the benefit of the members, and is not conducted for profit, nor does it carry on a trade or business or other undertaking of a similar character.
b.Proprietary Clubs are commercial enterprises owned by individuals, partners, or companies (whether incorporated or not) but may be managed by a committee as to part or all of its activities. Where, however, the proprietor exercises paramount control he/she will be in rateable occupation. These include Exclusive Gentlemen’s Clubs, Livery Halls and the like.
Either category of club may supply intoxicating liquor to members by virtue of grant under The Licensing Act 2003 of either a Club Premises Certificate, or a Premises Licence.
Licensed Sports, Social and Private Members’ Clubs covered by this Practice Note fall within Scat code 061. Care should be taken to use the correct scat code and not to confuse with clubhouses (scat 060), Nightclubs (scat 199), Community Centres (scat 067) Village Halls (scat 253) and snooker halls & snooker clubs (scat 253). Any assessments found to be in the wrong scat code should be amended by way of an MRL case. Examples of wrongly scat coded clubs found are reading clubs, flying clubs, gliding clubs, dance studios, youth clubs and martial arts clubs etc. This is a Generalist class therefore the appropriate suffix letter will be G.
Licensed Sports, Social and Private Members’ Clubs are a Generalist Class.
It is recommended that each Unit appoint a named co-ordinator/lead valuer, to act as a point of contact within the Unit. This individual will be responsible for assisting in the delivery of the Unit’s valuation scheme and also liaising on value and technical issues with other lead valuers across adjoining Units.
The Leisure Accommodation Class Co-ordination Team has overall responsibility for the co-ordination of this class. The team are responsible for the approach to and accuracy and consistency of valuations. The team will deliver Practice Notes describing the valuation basis for revaluation and provide advice as necessary during the life of the rating lists. Co-ordination responsibilities are set out in (Rating Manual: section 6 part 1).
Caseworkers have a responsibility to:
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follow the advice given at all times
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not depart from the guidance given on appeals or maintenance work, without approval from the co-ordination team
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keep CCT up to date with contentious cases and potential VT appeals
5.1 The Licensing Act 2003
The Licensing Act 1964 was superseded by the Licensing Act 2003. There were several amendments to the 1964 in between. The Licensing Amendment Act 1976 relaxed the provisions of the 1964 Act dealing with special hours certificates. In 1987 Sunday opening hours were revised. In 1988 Pubs were granted the option to remain open during the afternoon in England & Wales. In 1995, Sunday afternoon drinking was allowed.
In 2003 a new Licensing Act established a single integrated scheme for licensing premises used for the sale and supply of alcohol, to provide regulated entertainment, or late night refreshment. Under the Act permission can be secured to carry on some, or all, of these licensable activities within one single licence. Responsibility for issuing licences now rests with local authorities. The powers of the Act came fully into force at midnight, 23 November 2005.
There are now two types of licensing arrangement:- a Club Premises Certificate or a Premises Licence.
5.1.1 Club Premises Certificate
Licensing Act 2003 - Chapter 17 part 4 Section 60
1.In this Act “club premises certificate” means a certificate granted under this Part— a.in respect of premises occupied by, and habitually used for the purposes of, a club, b.by the relevant licensing authority, and c.Certifying the matters specified in subsection (2).
2.Those matters are— a.that the premises may be used by the club for one or more qualifying club activities specified in the certificate, and b.That the club is a qualifying club in relation to each of those activities (see section 61).
Qualifying clubs - Section 61
1.This section applies for, determining for the purposes of this Part whether a club is a qualifying club in relation to a qualifying club activity.
2.A club is a qualifying club in relation to the supply of alcohol to members or guests if it satisfies both— a.the general conditions in section 62, and b.the additional conditions in section 64.
3.A club is a qualifying club in relation to the provision of regulated entertainment if it satisfies the general conditions in section 62.
The general conditions Section 62
1.The general conditions which a club must satisfy if it is to be a qualifying club in relation to a qualifying club activity are the following.
2.Condition 1 is that under the rules of the club persons may not— a.be admitted to membership, or b.be admitted, as candidates for membership, to any of the privileges of membership, without an interval of at least two days between their nomination or application for membership and their admission.
3.Condition 2 is that under the rules of the club persons becoming members without prior nomination or application may not be admitted to the privileges of membership without an interval of at least two days between their becoming members and their admission.
4.Condition 3 is that the club is established and conducted in good faith as a club (see section 63).
5.Condition 4 is that the club has at least 25 members.
6.Condition 5 is that alcohol is not supplied, or intended to be supplied, to members on the premises otherwise than by or on behalf of the club.
Clubs holding a Club Certificate are restricted to serving alcohol to members only, but they can now hold events which relax the membership rule for up to 12 times in a single year. This permission comes under a Temporary Events Notice (TENS) and these must be applied for in advance. The rules governing these notices are:-
The event must:
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have less than 500 people at any one time – including staff running the event
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last no more than 168 hours, or 7 days
The applicant must be at least 18 to apply for a Temporary Event Notice.
There must be a TEN for each event held on the same premises.
A single premises can have up to 12 notices applied for in 1 year, as long as:
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the total length of the events is not more than 21 days
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1 person doesn’t make more than 5 applications for the premises
‘Late TENS’ can be applied for up to 5 working days before the event. A premises can apply for up to 10 late TENs per calendar year under a Club Certificate. If there are separate but consecutive events, there must be at least a 24 hour gap between them.
If the club does not qualify for a Club Premises Certificate then a Premises Licence will be required.
5.1.2 Premises Licence
A Premises Licence is required to sell alcohol or provide ‘licensable activities’ from any particular venue that does not constitute a qualifying club.
Licensable activities include:
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selling alcohol
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serving hot food and drinks between 11pm and 5am
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theatrical performance
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showing a film
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indoor sporting event
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boxing or wrestling (indoor or outdoor)
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live music
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recorded music
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dance
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facilities for making music
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dancing facilities
Restrictions
The applicant must be 18 or over to apply for a premises licence.
Conditions
A designated premises supervisor (DPS) must be in place when a licence is applied for. A DPS must have a personal licence to sell alcohol.
There may be other conditions added to the licence, eg having an age-checking policy where alcohol is to be sold.
5.1.3 Licence Registers
Each Local Authority (LA) has to provide a register of licences. Most LAs have these published on their websites with address search facilities. Some LAs don’t yet have the software capabilities to display the register in this way however, there is still a legal requirement to provide the information on request. Plans are sometimes attached to the on-line version of a licence.
5.2 Case Law
Licensed Members’ Clubs
In United Services and Services Rendered Club (Tooting and Balham) Ltd and the Putney Club v Thorneley (VO) (RA/86/1998) the member, Mr N J Rose FRICS, held in his interim decision that “the evidence of [four] rents adduced in these two appeals is sufficiently reliable to enable me to base my valuations of the appeal properties upon them. I do not consider that the method put forward by the appellants, which uses turnover as a starting point for the valuations, is of any assistance in preparing those valuations”, and in his full decision stated it was his opinion that “the available evidence, although limited, is sufficiently reliable to enable me to arrive at an accurate valuation of the appeal properties”; in his full decision in discounting the Receipts and Expenditure method of valuation he held that “those responsible for managing members’ club are likely to be motivated by a desire to provide those facilities which satisfy their members’ particular requirements, subject to the overall need to remain solvent.” He also stated that the appellants’ agent had “failed to take account of the more general benefits which the appeal properties provide to their members” by “concentrating primarily on turnover”.
Due to the many motives of occupation of members’ clubs, and of those which affect the receipts, other than that of maximising profit, it is not an acceptable approach to use account information for a receipts and expenditure valuation, nor turnover as a shortened method of valuation.
5.3 Town & Country Planning Use Class Order
Members clubs usually have a planning use type of D2 (Assembly & Leisure). The current use clases were updated in September 2020 and D2 was split out and replaced by the new Classes E(d) and F2(c-d) as well as several newly defined ‘Sui Generis’ uses.
Public Houses come under A4 (Drinking establishments) in England and A3 in Wales. However, many clubs will not have a use class assigned to them at all if they predate the Use Class order.
5.4 Clubs in Converted Premises
Following the Court of Appeal decision in R F Williams (VO) v Scottish & Newcastle Retail Ltd and Allied Domecq Retailing Ltd (RA/41/2001) rebus sic stantibus has been defined more narrowly. In valuing a club, which occupies converted premises, any higher alternative use value should not be taken into account, unless the alterations needed for this use are of a minor nature, and it can be proved that occupiers of clubs are prepared to pay a rent at the same level as the competing uses in this type of location.
However, where it can be shown that converted premises would command a higher rent as club premises owing to their particular suitability, the value is not limited to the alternative use.
In Barry West End Labour Club Ltd v Barry Area Assessment Committee (1932 KBD 16 R & IT 166), it was held that the assessment of a club occupying adapted house premises should not be based upon the value of the property as a house to which is added a percentage of the cost of adaptation. MacNaghten, J held “…. where a rateable hereditament is converted from one purpose to another…the cost of effecting the alterations affords no guidance at all as to what the value of the hereditament will be when altered”.
5.5 Catholic Clubs and Exemption
Roman Catholic Clubs are widespread throughout the Archdioceses of Liverpool, Shrewsbury, Salford and Lancaster and possibly elsewhere. The clubs are run with the object of fostering the spiritual and social life and wellbeing of the parish by providing the members with the opportunities and facilities for sociality, recreation and refreshment in suitable surroundings and to raise money for parochial purposes.
Following the Lands Tribunal case of Liverpool Roman Catholic Archdiocesan Trustees Incorporated v Mackay (VO) [1988 RA 90] it was accepted that such clubs were exempt under s39 of the General Rate Act 1967 (GRA 1967). This exemption continued under schedule 5 para 11 of the Local Government Finance Act 1988 (LGFA 1988) and until 2001 virtually all clubs will have been assumed to be exempt. Subsequently it became apparent that the management of many of these clubs had changed since the MacKay case and it is no longer safe to presume that they qualify for exemption.
The key point in the Mackay case was that the priest retained control of the premises and as the occupier satisfied the test in s39(2)(b) GRA 1967.
Some clubs, however, are not controlled by the parish priest but are run by a committee. The committee will usually occupy under a lease granted by the Diocese. As the Church (through the priest) is no longer in occupation, exemption cannot apply under Schedule 5 para 11 LGFA 1988.
In all cases it will be necessary to establish who is the rateable occupier.
A consideration of the club’s constitution or club rules will help to establish who controls the use and functioning of the building. Also if the club is let to a committee this will be conclusive that the Church is no longer in occupation and exemption cannot apply.
Further advice can be obtained from Technical Advisers.
Clubs and Institutes should be measured to Net Internal Area (NIA) in accordance with the VOA Code of Measuring Practice for Rating Purposes.
Rating surveys should be captured on the Rating Support Application (RSA) and plans and surveys stored in the property folder of the Electronic Document Record Management system (EDRM).
Typically the rental method of valuation should be adopted in determining the assessment of all club premises, rather than a turnover based approach. It is essential that all available evidence is considered and properly analysed in order to establish a proper basis of valuation. In considering any rental evidence it is important to establish whether or not the rent is at arm’s length, as some rents may be tainted as a result of connections between landlord and tenant or because the landlord is a brewer and the rent is subject to a tie.
Comparisons should be drawn over as wide an area as necessary and, in localities where rental information is limited, the CCT should liaise with Units ensuring that the valuation of this class is co-ordinated across the country. Although it is recognised that large differences in value could be justifiable.
Historically, The Royal British Legion Club rents have been agreed at discounted levels in return for accommodating the charity raising activities of the branch. The branch being an actual part of the RBL and the club in affect paying a fee to trade under the name of the RBL. Consideration should be given to the number of hereditaments that exist in these circumstances.
There is a distinct difference between Members’ and Proprietary clubs. This is mainly down to the fact that the former are non-profit making and the latter are generally run for profit. It is not always easy to tell them apart physically and even within the same type of club there can be a huge range. Proprietary clubs can be very similar in appearance to Members’ clubs and rental values would generally be expected to be at the same level for both for the majority of locations. However, Exclusive Members’ Clubs, such as those located in prime central London locations are likely to be valued having regard to the rental values for that particular type of club. In the absence of local rental evidence, regard to income would be appropriate.
An important characteristic of a club holding a club certificate is that there is a joint ownership of the stock of liquor by the members as a whole. When one member of the club is supplied with intoxicating liquor, there is not, in law, a sale of that liquor. They must also be non-profit making. There are many clubs that are ‘social clubs’ and the like in name only as they hold a premises licence enabling them to sell alcohol to non- members. Some proprietary clubs call themselves social clubs.
In some cases there is little difference between a public house and a club, if there is no requirement to hold a membership and the main objective is for profit, then regard should be had to whether the public house valuation basis is more appropriate (see Rating Manual: section 6 part 3 - section 825).
Care should be taken not to rely purely on the type of licence held when trying to distinguish between Members’ and Proprietary clubs. There are some genuine non-profit making Members’ clubs that hold a premises licence. Additionally there are some premises licences that have been issued where the club has volunteered certain conditions to be written in to the licence, restricting the sale of alcohol to members only. These conditions then become mandatory and cannot be breached.
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Rating Support Application (RSA)
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Survaid
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Class Co-ordination Team
1. Market appraisal
1.1 Clubs were once a major part of the fabric of communities, particularly in heavily industrialised regions. However, there has been a general fall in their popularity over the years. Historically, this was linked to structural changes to heavy industry which occurred during the 1980s and 1990s, but more recent decline has been a result of ageing membership, increased competition from supermarkets selling alcohol, and other licensed and leisure facilities. Drinking trends are changing as we become a more health conscious nation and many are choosing to spend recreational time enjoying more outdoor pursuits. When we do socialise, it’s becoming more likely to be in small groups within a similar age range and food will more often be the focus, with alcohol to complement.
1.2 The smoking ban which came into effect in July 2007 was blamed for a rise in club closures in the years following the introduction of the legislation. Increased operational costs are a continuing issue (wage and energy). Without being able to maintain a viable level of membership, many clubs struggle and face financial difficulties. This has resulted in the closure of some clubs and the disposal of the building for redevelopment, typically for residential or alternative commercial use.
1.3 In 1974 the CIU (Clubs and Institutes Union) had over 4,000 affiliated clubs in Great Britain and Northern Ireland. This number fell to 2,786 by 2001, 2,702 by 2003 and as at 2012 this stood at approximately 2,000. In 2021 there is understood to be 1,800 CIU affiliated clubs. It should be noted that other club associations exist, such as the Association of Conservative Clubs (ACC) which currently has a membership of about 800 licensed clubs.
1.4 The rating lists in England and Wales for Licensed Sports, Social and Private Members’ clubs with the special category code 061 indicate there has been a fall of around 3% at AVD (01 April 2021) compared to the those existing at 1 April 2017. When compared to the clubs present in the rating lists at 1 April 2010, the fall is around 11%. The formation of new Licensed Sports, Social and Private Members’ clubs are rare, although existing clubs do sometimes relocate into new purpose built premises, sometimes as a result of the compulsory purchase of the existing club site. It is thought that this general pattern will continue into the 2023 list.
1.5 However, as stated, whilst the number of clubs are generally falling, it is the case that some clubs are surviving and are relatively successful. This can be due to good management (diversification of activities to maintain or increase revenue), loyal membership and club premises that have been well maintained and invested in over the years. These clubs are often an integral part of the local communities in which they are situated. Where there is sufficient demand to increase revenue or membership, clubs will often have a live sport offer (football) as well as indoor sports facilities, typically snooker and darts. Well maintained outdoor facilities such as a ‘beer garden’ and children’s play equipment can provide a family friendly environment and help to boost trade especially in the summer months. Such facilities are becoming more value significant since the COVID 19 pandemic, similar to a pattern being established elsewhere in the licensed trade.
1.6 It may also be the case that some clubs may have benefited from the closure of local town or village public houses that were once a competitor, now the club may be the only option for a wet-led drinking venue.
1.7 Regardless of club performance, it is rental evidence that forms the basis for the rating valuations.
COVID Pandemic MARCH 2020–JULY 2021
1.8 The pandemic had a severe effect on the clubs, particularly the licensed premises in a similar way to public houses though furlough schemes and limited grant aid (including latterly restart grants ) were available to support businesses including social clubs that were required to close to the public and members .Some social clubs did continue to serve alcohol in tier 3 areas for a time before the rules were clarified and enforced and sales ceased in the same way as the public house trade. The impact of COVID on membership and income streams moving forward will influence the level of rent paid.
2. Changes from the last practice note
2.1 No changes are made to the practice note for the 2017 Revaluation section.
4.2 Added for National Sublocations to be used from 2023 Revaluation onwards.
3. Ratepayer discussions
3.1 No discussions with representatives of the industry have taken place.
4. Valuation scheme
4.1 Background
For the 2023 revaluation the background detail set out in the 2017 revaluation practice note is still relevant and this is replicated below. Whilst rental evidence for this class is usually scarce, rental information on a geographical or local basis should be considered in order to identify any trends or movement in rental values that should be reflected in the rateable value.
In revaluations prior to 2017, some locations valued members’ clubs primarily by reference to age, construction and location and insufficient regard was had to other material factors, such as:
- the different location factors of position and catchment area e.g. no account was taken in most places of a position overlooking the sea, other bodies of water and views or of any beer gardens.
- internal quality and facilities
- diversification
- the effects of the internet and social media
- demand for the property
- competition from other clubs and from other licensed leisure attractions
- the demography and social and financial characteristics of the catchment area
- material change of circumstances which had occurred over a number of years such as industrial decline and increased competition from other licensed and leisure attractions
There is now a sufficient level of rental evidence available to support 2023 Rateable Values. Historically, in order to review the relative values of different Licensed Sports, Social and Private Members’ clubs, turnover, where the consumption of alcohol is a significant activity, (Gross Takings All Sources) has been used as one such indicator of the relative merits of particular locations or clubs as well as a measure of the effect of MCCs. The use of turnover information for members’ clubs, in this limited way, may be helpful but it should be remembered that the way in which clubs are run varies greatly and the actual turnover of a particular club is not necessarily indicative of the true potential of a club. In many instances a club’s motive is not solely to provide intoxicating liquor nor necessarily to maximise turnover and it is therefore important that valuers do not place too much weight on turnover information but use it as one of the many factors that will indicate the use of the club by members and help establish the appropriate level of value for a particular club.
For proprietary clubs, where the aim of the occupier is to maximise profits of a business, turnover has a greater relevance as a means of comparison. It must, however, be remembered that for rating purposes the assumption is that the business will be proficiently carried out by a competent operator responding to the normal trading practices and competition of the locality. The objectives of the club and its amenities are relevant and if a proprietary club trades like a public house in a building capable of so operating then regard should also be had to a valuation on the licensed property basis.
If turnovers are being compared between two dates, any increase may in part be due to inflation, and may not necessarily be a sign of increased profit.
4.2 Valuation on the Rentals Method
Rental evidence is available and where identified full details should be sought. Reliable rental evidence has been used in arriving at the 2023 valuation schemes, most of which are schemes which run across several Economic Regions. This means that the values have been derived from a greater pool of supporting rental evidence than has been the case at previous Revaluations. The appropriate value per m2 is applied to the Net Internal Area of the property.
Rental evidence in this class is wide-ranging reflecting locality, size, age and quality.
Hereditaments within this class have all been data captured into national sublocations:
- LCL1- Very Good Licensed Sports, Social & Private Members’ Clubs
- LCL2- Good Licensed Sports, Social & Private Members’ Clubs
- LCL3- Average Licensed Sports, Social & Private Members’ Clubs
- LCL4- Basic Licensed Sports, Social & Private Members’ Clubs (Below Average)
- LCL5- Inferior/Non-Standard Licensed Sports, Social & Private Members’ Clubs
- LCLF- Licensed Sports, Social & Private Members’ Clubs with no ground floor main space
These sublocations do not apply to ‘gentlemen’s clubs’ or private members’ clubs situated in the highest value parts of central London, such as in Mayfair, Piccadilly and around Park Lane.
4.3 Relativities
No change to existing relativities are made.
| Level | Accommodation | % of main space |
|---|---|---|
| GF | Main bar, lounge, clubroom | 100% |
| Ground Floor | Offices, committee rooms, Kitchens | 66% |
| Beer Cellars Stores | 50% | |
| Changing rooms | 66% | |
| FF | Main bar, lounge, clubroom | 75% |
| First Floor | Offices, committee rooms, Kitchens | 50% |
| Beer cellars, stores | 37.5% | |
| Bst | Main bar, lounge, clubroom | 50% |
| Basement | Beer cellars, stores | 25% |
| Offices, committee rooms, Kitchens | 25% | |
| Outside | Outbuildings | 25% |
4.4 Car parking
It is recommended that the values adopted should reflect car parking, except where it can be shown that the presence of exclusive parking facilities adds value to the club. Where a club does not have an exclusive car park it is unlikely than an allowance would be warranted unless the parking facilities in the locality are wholly inadequate for that locality. If additional value is placed on parking, the level per space adopted should reflect the spaces as ancillary to the club and not necessarily at the full car park value for that location. This stand back and look approach will avoid situations where the parking total value forms by far the largest proportion of the RV.
4.5 Heating and air conditioning
It is recommended that the values adopted should reflect heating and that a deduction of 5% should be made where heating is not present (except for cellars, outbuilding etc. Where this is reflected in the relativity adopted).Where air conditioning is present, an addition should be made to the valuation for this element.
4.6 Sports facilities
Some clubs may include within the hereditament sports facilities such as a bowling green or football pitch.
In order to be able to compare the main space prices of one club with another it is recommended that where a club includes sports facilities that these be valued separately having regard to the prevailing tone for such amenities and not reflected in the price adopted for the club. The club price adopted should, however, adequately reflect the cost of providing and maintaining the sports facility.
Care must be taken to distinguish between a social club with a sports facility (to be valued as a social club) and a sports ground and clubhouse with social membership (to be valued as a sports ground). In cases of doubt the main objectives in the club’s constitution will determine whether to value as a social club or as a sports facility (see Rating Manual: section 6 part 3 - section 970)
4.7 Quantum/obsolescence
In some instances there may be parts of a club that are no longer used and are surplus to requirements or clubs that are now disproportionately large compared with their needs at the material day. These are factors for which adjustments may be required but caseworkers should exercise great care in such cases. . These allowances should be the exception rather than the rule, with each being judged on its own merits. Rents have been analysed on licensed clubs without such allowances being made so values adopted reflect their size.
4.8 Split level sites
In some cases where a club occupies a split level site there may be main space accommodation such as snooker rooms, concert rooms, committee rooms etc. at lower ground floor level. In such instances it is recommended that if the accommodation is comparable in quality to that normally found at first floor level that the first floor relativities are adopted.
4.9 Other non-standard accommodation
Some clubs may include additional ancillary accommodation such as gyms, boxing rings, skittle alleys etc. and these should be valued having regard to their quality in comparison to other parts of the club.
4.10 Dressing rooms
Fitted dressing rooms located within the main structure of the concert room should be valued as part of the concert room. If the dressing room is structurally separated from the concert room it should be valued on the office relativity.
Measured to NIA both staff and customer toilets (WCS) should be deemed reflected in the basic price adopted. Cloakroom areas should be included in the valuation.
4.11 Entrance areas
Measuring to NIA these will generally be excluded. Large entrance areas, however, which have facilities such as cigarette or gaming machines should have part of their area included in the valuation.
1.Market Appraisal
Clubs were once at the heart of the British working class population from small children right up to the elderly. They were often the starting venues for many famous live acts such as comedians and bands. However, there has been a general fall in their popularity over the years. Historically, this was linked to structural changes to heavy industry which occurred during the 1980s and 90s such as pit closures, but more recent decline has been a result of ageing membership, increased competition from supermarkets selling cheap alcohol, and other licensed and leisure facilities. There has also been a definite shift in public attitude towards clubs and drinking trends are changing as we become a more health conscious nation. Many are choosing to spend recreational time enjoying more outdoor pursuits. When we do socialise, it’s becoming more likely to be in small groups within a similar age range and food will more often be the focus, with alcohol to complement.
With membership dwindling, many clubs are struggling and face financial difficulties. In 1974 the CIU (Clubs & Institutes Union) had over 4,000 affiliated clubs. This number fell to 2,786 by 2,001, 2,702 by 2003 and as at 2012 this stood at approximately 2,000. The smoking ban which came into effect in July 2007 has been heavily blamed for the recent rise in club closures however it’s likely to be a combination of causes that has contributed to the number of closures seen nationally. On the plus side, some clubs have successfully managed to reinvent themselves as live music venues as the buildings tend to have good acoustics due to them originally being designed with entertainment in mind.
Regardless of club performance, it is rental evidence that must form the basis for rating valuation.
2. Changes from the last practice note
There was no Practice Note for the 2010 Revaluation.
3. Ratepayer Discussions
To date initial discussions have taken place with representatives of the industry and are ongoing.
It is still expected that detailed rental schedules are going to be provided by the main operators (or their agents). Some of this information is being supplied through the Valuation Office Ratepayer Contact Scheme (VORC). Direct rental evidence may not exist, rents quoted may relate to franchise rents rather than the rent of the individual unit so care needs to be taken.
4. Valuation Scheme
4.1 Background
For the 2017 revaluation, a network wide look at rents has been carried out by the CCT members with the aim of being able to provide value guidance to each Location and ensure a consistent approach is followed.
In previous revaluations some locations valued members’ clubs primarily by reference to age, construction and location and insufficient regard was had to other material factors, such as:
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the different location factors of position and catchment area
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internal quality and facilities
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demand for the property
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competition from other clubs and from other licensed leisure attractions
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the demography and social and financial characteristics of the catchment area
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material change of circumstances which had occurred over a number of years such as industrial decline and increased competition from other licensed and leisure attractions
In order to review the relative values of clubs in different locations, or different aged clubs within a locality, turnover, where the consumption of alcohol is a significant activity, (Gross Takings All Sources) has been used as one of the indicators of the relative merits of particular locations or clubs as well as a measure of the effect of MCCs. The use of turnover information for members’ clubs, in this limited way, may be helpful but it should be remembered that the way in which clubs are run varies greatly and the actual turnover of a particular club is not necessarily indicative of the true potential of a club. In many instances a club’s motive is not solely to provide intoxicating liquor nor necessarily to maximise turnover and it is therefore important that valuers do not place too much weight on turnover information but use it as one of the many factors that will indicate the use of the club by members and help establish the appropriate level of value for a particular club.
For proprietary clubs, where the aim of the occupier is to maximise profits of a business, turnover has a greater relevance as a means of comparison. It must, however, be remembered that for rating purposes the assumption is that the business will be proficiently carried out by a competent operator responding to the normal trading practices and competition of the locality. The objectives of the club and its amenities are relevant and if a proprietary club trades like a public house in a building capable of so operating then regard should also be had to a valuation on the licensed property basis.
If turnovers are being compared between two dates, any increase may in part be due to inflation, and may not necessarily be a sign of increased profit.
4.2 Relativities
| Floor level | Accommodation | % of main space |
| GF | Main bar, lounge, clubroom | 100% |
| Offices, committee rooms, Kitchens | 66% | |
| Beer Cellars Stores | 50% | |
| Changing rooms | 66% | |
| FF | Main bar, lounge, clubroom | 75% |
| Offices, committee rooms, Kitchens | 50% | |
| Beer cellars, stores | 37.5% | |
| Bst | Main bar, lounge, clubroom | 50% |
| Offices, committee rooms, Kitchens | 33% | |
| Beer cellars, stores | 25% | |
| Outside | Outbuildings | 25% |
4.3 Car Parking
It is recommended that the values adopted should reflect car parking, except where it can be shown that the presence of exclusive parking facilities adds value to the club. Where a club does not have an exclusive car park it is unlikely than an allowance would be warranted unless the parking facilities in the locality are wholly inadequate. If additional value is placed on parking, the level per space adopted should reflect the spaces as ancillary to the club and not necessarily at the full car park value for that location. This stand back and look approach will avoid situations where the parking total value forms by far the largest proportion of the RV.
4.4 Heating & Air Conditioning
It is recommended that the values adopted should reflect heating and that a deduction of 5% should be made where heating is not present (except for cellars, outbuildings etc. where this is reflected in the relativity adopted).Where air conditioning is present, an addition should be made to the valuation for this element.
4.5 Sports Facilities
Some clubs may include within the hereditament sports facilities such as a bowling green or football pitch.
In order to be able to compare the main space prices of one club with another it is recommended that where a club includes sports facilities that these be valued separately having regard to the prevailing tone for such amenities and not reflected in the price adopted for the club. The club price adopted should, however, adequately reflect the cost of providing and maintaining the sports facility.
Care must be taken to distinguish between a social club with a sports facility (to be valued as a social club) and a sports ground and clubhouse with social membership (to be valued as a sports ground). In cases of doubt the main objectives in the club’s constitution will determine whether to value as a social club or as a sports facility (see Rating Manual: section 6 part 3 - section 970).
4.6 Quantum/Obsolescence
In some instances there may be parts of a club that are no longer used and are surplus to requirements or clubs that are now disproportionately large compared with their current needs. These are factors for which adjustments may be required but caseworkers should exercise great care in such cases.
4.7 Split Level Sites
In some cases where a club occupies a split level site there may be main space accommodation such as snooker rooms, concert rooms, committee rooms etc. at lower ground floor level. In such instances it is recommended that if the accommodation is comparable in quality to that normally found at first floor level that the first floor relativities are adopted.
4.8 Other non-Standard Accommodation
Some clubs may include additional ancillary accommodation such as gyms, boxing rings, skittle alleys etc. and these should be valued having regard to their quality in comparison to other parts of the club.
4.9 Dressing Rooms
Fitted dressing rooms located within the main structure of the concert room should be valued as part of the concert room. If the dressing room is structurally separated from the concert room it should be valued on the office relativity. Measured to NIA both staff and customer toilets (WCS) should be deemed reflected in the basic price adopted. Cloakroom areas should be included in the valuation.
4.10 Entrance Areas
Measuring to NIA these will generally be excluded. Large entrance areas, however, which have facilities such as cigarette or gaming machines should have part of their area included in the valuation.