Motor racetracks and go kart rinks
This publication is intended for Valuation Officers. It may contain links to internal resources that are not available through this version.
This guidance applies to all motor racetracks, go kart rinks and speedway racetracks.
Racetracks and rinks within this grouping take on a wide variety of different forms both in their physical make up and in their use. There are tracks that are purpose built to international standards and others of a far less sophisticated nature created perhaps from disused airfields. Top-end tracks are used for Grand Prix and Formula One racing and others are used solely for small Club events. There is a world of difference between the major tracks handled by the National Valuation Unit and the remainder dealt with in Regional Valuation Units.
Karting is split into four main categories: cadet, junior, Senior and gearbox and is readily accessible through arrive-and-drive facilities, which include indoor rinks.
In Speedway the UK has three main domestic leagues, the Premiership, the Championship and the National League, as well as two ‘junior’ amateur leagues. It also has a youth championship.
It is important to gain a full understanding of the sort of undertaking under consideration, and have available details as to the type or types of racing and the sorts of ancillary uses permitted, such as vehicle testing and race tuition.
Additionally, the number of days on which such uses can be exercised must be established. The permitted number of these days may well have been reduced in recent years.
Primary description: LX
List description: motor racetrack and premises
Scat code: 191
Scat suffix: N (NVU) or G (Unit Generalist)
Primary description: LX
List description: go kart track and premises
Scat code: 116
Scat suffix: G (Unit Generalist)
Primary description: LX
List description: speedway racetrack and premises
Scat code: 254
Scat suffix: S (NVU)
These cover a very wide-ranging scale of property and responsibility rests in accordance with the scat suffixes detailed above. The national/international standard motor racetracks are dealt with by the National Valuation Unit (NVU).
The Racing Class Co-Ordination team has overall responsibility for the co-ordination of these classes. The team is responsible for approach, 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. Caseworkers and referencers have a responsibility to:
- follow the advice given at all times
- not depart from the guidance given on appeals or maintenance work without approval from the co-ordination team
- seek advice from the co-ordination team before starting any new work
Motor racetracks come under the jurisdiction of the Royal Automobile Club Motor Sports Association who are responsible for the issue of track licences. The licence granted will dictate the types of meeting which may be held at any individual track.
All Speedway meetings are held under the Speedway Control Board Regulations.
Further restrictions on all tracks (for example on the frequency of meetings or on the use of a track for vehicle testing) may be imposed by the Local Planning Authority. Noise restrictions have become more onerous for many over the last five years.
All buildings should be measured to Gross Internal Area (GIA) in accordance with the VOA Code of Measuring Practice. For the length of the race track linear metres (miles) and width of track should be recorded in addition to the overall site area. In addition the following should be noted:
a. the complexity of signalling and safety facilities/precautions around the track to enable racing to take place
b. the number, size and condition of garaging, workshops and other facilities to enable racing to take place
c. the facilities for spectators including size and location of stands (including capacity), refreshment facilities and any museums
d. the number of race days, practice days open to the public and charges made for entry for the various events, daily attendance numbers
e. details of any use of the track for other purposes such as testing including number of days used and charging
f. where the property is rented details of all tenant’s improvements
Surveys and plans should be stored in the property folder of the Electronic Document Records Management (EDRM) system.
8.1 General
Given the wide variety of tracks/rinks and the wide variety of occupiers, these properties do not lend themselves readily to one particular method of valuation. Consideration must be given to all the evidence available, whether it be rental or accounts. The most appropriate approach that best fits the circumstances of a particular case should be adopted.
Whatever approach is adopted individual tracks/rinks should bear comparison one with another.
8.2 Rental approach
Rental evidence is known to be limited but when reliable information is available then this will provide the best evidence of value. Care should be taken when considering rents to ensure that the full extent of any rateable tenant’s improvements is known. It is unlikely that those individual rents which are known will be of any great assistance generally, other than for the circuit in question, and accordingly in the majority of cases recourse to a receipts and expenditure (R&E) or comparative receipts basis will be necessary.
For indoor go kart rinks there will usually be a sufficient body of rental evidence.
8.3 Receipts and expenditure (R&E) approach
In the absence of rental evidence and in circumstances where it is possible to discern that profit is the prime motive of occupation then a valuation based upon accounts is likely to be the best starting point. Full copies of audited accounts for at least the three years prior to the date of valuation should be requested, and further reference made to Rating Manual: section 4 part 2.
There are, however, difficulties associated with the interpretation of the accounts in relation to expenditure made to produce potential additional income or even maintaining the current level of receipts. The difficulties are, in the main, the application of valuation techniques and advice will be provided, where necessary, through the CCT.
In certain cases it may be found that a strict R&E approach produces a nil or very low value which patently does not represent the proper letting value of the property. In such circumstances a valuation based upon a percentage of gross receipts may be more appropriate. The percentage should be guided by analysis of assessments founded on more reliable evidence.
All valuations should be entered onto the Non-Bulk Server (NBS) under the relevant Scat code.
Other support available:
- Survaid
- Class Co-ordination team
1. Market appraisal
1.1 Motorsport retains its popularity and the UK remains a major player in it. This is evidenced by the number of F1 teams who have their operational and technical centres based in the UK. Between 2015 and 2021 the total number of motor racetracks has remained relatively static.
1.2 The future of the British Grand Prix at Silverstone after 2019 had been uncertain after the owner activated a “break clause” in its existing contract with F1 in a desire to negotiate new affordable terms. In July of 2019, after intense negotiations, it was announced that a new agreement had been reached for Silverstone to continue to hold the event until 2024.
1.3 In addition to F1, MotoGP and World Superbike many rounds of other international and national championships involving professional drivers and riders are hosted at tracks in the UK. There is also a large club racing scene which includes many events for amateur enthusiasts competing in various categories/classes for cars and motorcycles.
1.4 The COVID-19 pandemic had a major impact on motorsport in the period leading up to the AVD (1 April 2021). Details of the various restrictions implemented by statute in response to the pandemic, and of the vaccination rollout can be found online. In February 2021 the UK Government published its Roadmap out of lockdown for England which set out four steps to relax restrictions. Step 1, easing restrictions on outdoor gatherings, had already taken place by the AVD.
1.5 The later three stages of the Roadmap for England included
- the opening of outdoor hospitality, and non-essential retail (Step 2, no earlier than 12 April);
- most legal restrictions on meeting others outdoors to be lifted, opening of indoor entertainment venues such as cinemas and casinos (Step 3, no earlier than 17 May); and
- the removal of remaining restrictions on social contact (Step 4, no earlier than 21 June).
1.6 It was not until the 19th July 2021, following the Prime Minister’s announcement that Step 4 on the roadmap would proceed as planned that spectators fully returned, and some clubs were able to organise events.
1.7 The situation in Wales, both leading up to and after the AVD, was similar although not identical.
2. Changes from the last practice note
2.1 There are no fundamental changes since the last practice note.
3. Ratepayer discussions
3.1 There have been no 2023 List discussions
4. Valuation scheme
4.1 Limited reliable rental evidence will be available, if any, due to the impact of the pandemic, and any rents will need to be scrutinized in detail to establish the precise basis of payment.
4.2 In the absence of rental evidence the more significant operations are likely to support the application of a full R&E basis. However, at that level, the business structure may be complex and external objectives may drive the motive for occupation to the extent that it is not straightforward to use the accounts data in arriving at the underlying rental value of the property. To the other extreme, small club run sites are likely to encounter ability to pay issues, but this does not necessarily mean that there is a nominal occupational value. Once more the above must be considered in the context of the impact of covid and that the last reliable set of trading accounts will be for those with a year end up to March 2020.
4.3 Over the years evidence from accepted assessments has helped develop an expected range of percentages to apply to gross receipts (net of VAT) in order to derive the rateable value. For 2023 the recommend bid ranges are as follows:
| Motor racetracks of an international/national standard | 9% to 12% |
| Other motor racetracks | 4% to 8% |
4.4 The relative level of turnover and ease of operation/maintenance will determine where in the range a particular property should sit.
1. Market appraisal
1.1 Between 2015 and 2021 the total number of speedway racetracks has remained relatively static. Income is primarily a mix of match day income and payment for TV rights. Speedway clubs compete within a set of league structures, which were altered in 2017 to provide for promotion and relegation. Riders are self-employed and able to move clubs and may compete in multiple leagues and countries at the same time.
1.2 The COVID-19 pandemic had a major impact on speedway in the period leading up to the AVD (1 April 2021). Details of the various restrictions implemented by statute in response to the pandemic, and of the vaccination rollout can be found online. In February 2021 the UK Government published its Roadmap out of lockdown for England which set out four steps to relax restrictions. Step 1, easing restrictions on outdoor gatherings, had already taken place by the AVD.
1.3 The later three stages of the Roadmap for England included
- the opening of outdoor hospitality, and non-essential retail (Step 2, no earlier than 12 April);
- most legal restrictions on meeting others outdoors to be lifted, opening of indoor entertainment venues such as cinemas and casinos (Step 3, no earlier than 17 May); and
- the removal of remaining restrictions on social contact (Step 4, no earlier than 21 June).
1.4 It was not until the 19th July 2021, following the Prime Minister’s announcement that Step 4 on the roadmap would proceed as planned that spectators fully returned, and some clubs were able to organise events.
2. Changes from the last practice note
There are no fundamental changes since the last practice note.
3. Ratepayer discussions
There have been no 2023 List discussions.
4. Valuation scheme
Rental basis
Rental evidence is known to be limited but when reliable information is available then this will provide the best evidence of value. Care should be taken when considering rents to ensure that the full extent of any rateable tenant’s improvements is known. It is unlikely that those individual rents which are known will be of any great assistance generally, other than for the circuit in question, and accordingly in the majority of cases recourse to a receipts and expenditure (R&E) or comparative receipts basis will be necessary.
Receipts and expenditure/comparative receipts basis
In the absence of rental evidence the more significant operations are likely to support the application of a full R&E basis. However, at that level, the business structure may be complex and external objectives may drive the motive for occupation to the extent that it is not straightforward to use the accounts data in arriving at the underlying rental value of the property. To the other extreme, small club run sites are likely to encounter ability to pay issues, but this does not necessarily mean that there is a nominal occupational value.
Over the years accepted assessment evidence has acted to help develop an expected range of percentages to apply to gross receipts (net of VAT) in order to derive the rateable value.
For 2023 the recommended bid range is 4% to 6%.
The relative level of turnover and ease of operation/maintenance will determine where in the range a particular property should sit.
1. Market appraisal
1.1 Indoor karting circuits began to grow in number around England in the mid 1980’s. The venue was usually a derelict bus garage or a converted warehouse. The first eco track was opened in Jan 2011 and the electric karts are powered by Lithium batteries with top speeds reaching only 40 mph.
1.2 Go karting is a popular motorsport in the UK and tracks maybe indoor and outdoor and usually have a variety of customers including corporate groups, stag and hen parties and individuals.
1.3 Indoor go-karting has seen a rise in popularity as a leisure activity leading up to the Covid Pandemic in 2020 but between 2015 and 2019 the numbers attending go-karting has remained relatively static. Karting is split into 4 main categories: Cadet, Junior, Senior and Gearbox.
1.4. Some very sophisticated two-tier tracks have been constructed within existing industrial building envelopes. These use electric karts and boast ever longer tracks, with the longest at 1,050 m.
1.5 The COVID-19 pandemic had a major impact on Go Karting in the period leading up to the AVD (1 April 2021). Details of the various restrictions implemented by statute in response to the pandemic, and of the vaccination rollout can be found online. In February 2021 the UK Government published its Roadmap out of lockdown for England which set out four steps to relax restrictions. Step 1, easing restrictions on outdoor gatherings, had already taken place by the AVD.
1.6 The later three stages of the Roadmap for England included
- the opening of outdoor hospitality, and non-essential retail (Step 2, no earlier than 12 April);
- most legal restrictions on meeting others outdoors to be lifted, opening of indoor entertainment venues such as cinemas and indoor karting (Step 3, no earlier than 17 May); and
- the removal of remaining restrictions on social contact (Step 4, no earlier than 21 June).
1.7 The situation in Wales, both leading up to and after the AVD, was similar although not identical.
2. Changes from the last practice note
2.1 There are no fundamental changes since the last practice note.
3. Ratepayer discussions
3.1 There have been no 2023 list central discussions.
4. Valuation scheme
Rental basis
4.1 For go-karting premises rental evidence should be analysed in terms of price per square metre. Adequate rental evidence is expected to be available in respect of indoor go-karting rinks. Careful attention must be given to ensure that the full extent of any rateable tenant’s improvements is properly reflected and any use restrictions under the lease are correctly interpreted. It is anticipated that rents of former industrial premises used for both types of facilities will often be below the local industrial or warehousing tone. Values are unlikely to have increased significantly from 2017 if at all, though this will be evidenced from rental evidence or turnover. Regard should also be had to other similar leisure uses in former industrial buildings such as indoor roller skating rinks.
Receipts and expenditure/comparative receipts basis
4.2 In the absence of rental evidence the more significant operations are likely to support the application of a full R&E basis. Over the years accepted assessment evidence has acted to help develop an expected range of percentages to apply to gross receipts (net of VAT) in order to derive the rateable value.
4.3 For 2023 the recommended bid ranges are as follows:
Go-kart Rinks 4% to 8%
4.4 The relative level of turnover and ease of operation/maintenance will determine where in the range a particular property should sit.
4.5 The effects of the COVID-19 outbreak need to be taken into account as they would have been anticipated by the parties at the AVD. Trade evidence that includes long periods of lockdowns is unlikely to provide good evidence of the FMT at the AVD. Valuers are advised to take as their starting point the closest reliable trade, which is likely to be the 2019/2020 trading year (ending March or before) and any previous trading years.
4.6 Having established the likely FMT for the 19/20 trading year (ending March or before), the valuer should then consider any further adjustments needed to reflect the receipts envisaged as at 1 April 2021. The reasonable efficient operator (REO) will take a view not only on the trade immediately achievable at AVD, but the trade over a period of time ahead, as they are assumed to be taking a tenancy with a reasonable prospect of continuance.
1. Market Appraisal
Between 2008 and 2015 the total number of Motor Racetracks/Speedway Racetracks has remained relatively static.
However between 2008 and 2009 there was great uncertainty as to where the British Grand Prix was to be held, if at all. At one point Donnington Park was granted the rights to the British Grand Prix, but they could not deliver the necessary changes, and it returned to Silverstone without a break. Donnington Park went in to Administration and was not physically useable as a track for a period because of the works that had been started and then abandoned.
Whilst Silverstone has a long term agreement to hold the British Grand Prix it has been widely reported that the future of the race is uncertain because of costs. A decision not to hold the race could be made before 1st April 2017.
Indoor go-karting has seen a rise in popularity as a leisure activity in recent years. Some very sophisticated two-tier tracks have been constructed within existing industrial building envelopes. These use electric karts and boast ever longer tracks with the likes of Capital Karts London suggesting they currently provide the longest at 1,050 metres, with average lap times in excess of 78 seconds.
2. Changes from the last practice note
There are no fundamental changes since the last Practice Note..
3. Ratepayer Discussions
There have been no 2017 List discussions.
4. Valuation scheme
Rental Basis
Adequate rental evidence is expected to be available in respect of indoor go-karting rinks. Careful attention must be given to ensure that the full extent of any rateable tenant’s improvements is properly reflected and any use restrictions under the lease are correctly interpreted.
Limited rental evidence is available for other types, and, where it is, it equally needs to be scrutinised in detail to establish the precise basis of the payment.
Receipts and Expenditure/Comparative Receipts Basis In the absence of rental evidence the more significant operations are likely to support the application of a full R&E basis. However, at that level, the business structure may be complex and external objectives may drive the motive for occupation to the extent that it is not straightforward to use the accounts data in arriving at the underlying rental value of the property. To the other extreme, small club run sites are likely to encounter ability to pay issues, but this does not necessarily mean that there is a nominal occupational value. Over the years accepted assessment evidence has acted to help develop an expected range of percentages to apply to gross receipts (net of VAT) in order to derive the rateable value.
For 2017 the recommended bid ranges are as follows:
Motor Racetracks of national/international standard ………10% to 12%
Other Motor Racetracks/Go-kart Rinks……..4% to 8%
Speedway Racetracks…….4% to 6%
The relative level of turnover and ease of operation/maintenance will determine where in the range a particular property should sit.
The RPI from April 2008 to April 2015 shows an increase of some 20%, which would imply that a property will need to have increased receipts by a similar percentage to have “stood still” in terms of profitability. For many properties the turnover will need to have increased in excess of this RPI average for profitability (and rental bid) to have remained the same. This needs to be borne in mind when considering the percentage to be applied to gross receipts for 2017.
1. Co-ordination arrangements
Motor Racetracks and Go Kart rinks as classes are split between Groups and Specialist Rating Units, with SRUs dealing with those over £25,000 RV. Responsibility for effective co-ordination lies with SRUs. For more information see Rating Manual Section 6 : Part 1
For Motor Racetracks Special Category Code 191 should be used, for Go Kart rinks Special Category Code 116 should be used. As a split classes the appropriate suffix letter should be either G or S.
2. Valuation guidance
Valuation guidance on this class is outlined in paragraph 5 of this section. Care should be taken in the analysis of any rental evidence that rateable tenant’s improvements are fully reflected
3. IT support
The development a new facility on the Non Bulk Server (NBS) should enable input of factual data to achieve valuations that follow the recommended approach for motor racetracks and go kart rinks. All valuations should be entered onto the NBS under the relevant Scat Code.