London’s music venues are recovering – but business rate review could stop them in their tracks

A woman dances in a nightclub. Image: Getty.

Much has been written about the revaluation of business rates and their impact up and down the country. Due to an outcry from a number of sectors and business lobbying groups, not least the CBI, the chancellor is considering measures to relieve those facing the highest increases. (In his recent Budget, indeed, he gave pubs a rebate of up to £1,000, though he did nothing for other sectors.)

Most of the businesses worst affected are in zones 1 and 2 in London, where property has, in some cases, doubled in value since the last valuation was conducted in 2008. And it is the independent retail and commercial sector that will feel these rises the most. A large high street chain can shoulder a rate increase of between 25 and 30 per cent; an independent cafe or restaurant often can't. Such an increase, after all, could mean an extra bill of up to £15,000 for a mid-sized premises. That would be enough to close an independent pizza shop, but allow Pizza Express to survive. 

Of these independent businesses that are most threatened, at the top of the list are our grassroots music venues and nightclubs. Over the past ten years, 50 per cent of London's nightclubs have closed, along with 35 per cent of its music venues.

In fact, there have recently been some signs of recovery in the ecosystem. Last month, the Greater London Authority published a report that found there had been no net loss of venues in 2016, a first since 2007. A few new venues have even opened, including The Soundlounge in Tooting, Sankeys East in Romford and, at the end of March, Soul Store West in Kilburn.

Now this rates rise threatens to derail this progress. And there remains something rotten in the way we value these places: when assessing and calculating their rates, we don’t consider their cultural or economic value. These premises are the incubators of the sector, each investing £500,000 directly into new and emerging talent each year. And yet, unlike community centres and libraries, for example, little relief is offered that recognises the benefits these places and spaces bring to their communities. 

Indeed, instead of recognising this value, we are doing the opposite. Take The Lexington, in Islington. In the past, it's hosted many artists who you wouldn't have heard of at the time, but almost certainly would have now. Yet the value of the land the venue sits on has increased significantly, increasing the value of the property and thus its business rate. (It's a similar system to council tax.)


There's another penalty: rates recategorisation often means an increase in annual alcohol licence fees that can also run into thousands of pounds. Paying for that means selling more alcohol, which puts pressure on the businesses to stop providing the unprofitable live music aspect. And so The Lexington, instead of being a music venue and community asset, becomes a solely alcohol-led premises, similar to a chain pub or bar.

All this is compounded by the way that venues in London are being penalised for their success in regenerating its town centres. Cafe Oto opened at a time when Dalston town centre was not as desirable as it is now. Its contribution to the local community – along with those of many other businesses and entrepreneurs – has led to Dalston changing and becoming more desirable. Yet Cafe Oto and the like have not been recognised as agents of change and arbiters of community cohesion; instead, the work they've done merely means the land they sit on has become more expensive, and so their rates are going up.

There is no standard classification of music venues and nightclubs in the system by which we assess rateable value: they not categorised as a particular type of business, so their floor space is assessed not on its need to welcome an audience, but on its size and its capacity to sell enough alcohol to fill that space. Yes, venues and nightclubs often live or die on their ability to sell alcohol, but without the music – the culture – people wouldn’t be drinking that alcohol in the first place. Yet this is not recognised: their cultural value is ignored, and venues are made to pick up the tab in more ways the one.

It would be best if such places were assessed for what they are, rather than being lumped into a general categorisation that more often than not impacts them negatively. They should all pay business rates – this is the only way core services can be delivered – but increases in those rates should take account of their community benefit, and recognise their cultural value. 

If we don’t take a good hard look at how our classification and rating systems measures music venues and nightclubs – or cultural infrastructure in general – we  will lose these places. The recent spate of good news will disappear, and we’ll be back to hearing about venue closures in London and beyond.  

And the same argument applies to other sectors, too: if we don't recognise the value of independent cafes, there is a danger that rate rises will one day mean that Costa Coffee is the only place that'll sell you a flat white. 

The author would like to thank Niall Forde, the Music Venue Trust and Nordicity for support in writing this article. 

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Letter: Does it really make sense to stand on just one side of the escalator?

Walking will not speed things up. Image: Getty.

Our latest dip into the CityMetric postbag...

Dear CityMetric,

I was scanning the article by Jamie Lloyd on the Hong Kong metro. It sounds lovely – I’ve never been but will try and check it out one day, for sure.

However, I got annoyed about half way down;

 “One caveat is in order: people stand on both sides of the escalator. It is hard to find the right words to describe how this I feel about this without descending into cheap hyperbole. I will merely say that this makes me feel like shooting myself into the sun. In a metro network defined by its commitment to functionality, the acceptance of this behaviour baffles me.”

I simply don’t understand this. And it infuriates me every time I have to battle the tube on the way to meetings in London, particularly when everything is snarled up at the top or bottom of escalators.

Plenty of research has shown that making everyone stand, regardless of which side of the escalator they are, might actually speed things up; and articles have appeared covering the topic, for example, here and here. Thinking about it, it’s not unlike a Smart Motorway, where we effectively make everyone go at the same speed to significantly increase capacity, by reducing braking, rather than allowing the odd BMW driver whizz along at 85mph, causing everyone else to brake/panic/swerve/crash around them. There’s a YouTube video on Traffic Snakes which talks about this very effect. It’s exactly the same argument as standing on escalators.

At Birmingham New Street station, the escalators often develop into a standing only state through no fault of the station management, particularly when a full train arrives in the peak periods – that was even before the recent makeover. But although there’s a lot of standing around, it works, and everyone gets on with their day a bit quicker. I'm not sure how it starts: I suspect someone stands on the left and everyone files in behind them. But then when I get on the Tube, I start to hear the tutting and shouting and all sorts, which doesn’t strike me as friendly or, more importantly, efficient. 

So I wonder why there isn’t more talk about changing habits on the underground, given all the evidence. Perhaps a fine website like yours might want to push for it a bit more, to see what impact it has; maybe get some more information from TfL on their trial. It would seem perfectly reasonable to instigate it during peak times – after all you’re only rushing along the escalators to join a queue to board a train – but keep it as current during less busy times.   

It really does seem that everyone appears to be in favour of using transport more efficiently, but no one thinks to tackle glaringly obvious bits. 

Thanks 

Steve Pearce

Birmingham

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