Doctors rents and rates

Question 1

What is the defintion of Current Market rent?

Answer 1

PCD 2004 - ‘What might reasonably be expected to be paid by a tenant for the premises at the valuation date’.

Question 2

What are the notional lease terms?

Answer 2

• 15 year lease
• TIR
• 3 yearly rent reviews:
• 2004 PCDs - upwards only rent reviews
• 2013 PCDs - upwards and downwards rent reviews with a floor of the initial rent
• 2004 PCDs - Can reflect Alternative Use Value (AUV)
  2013 PCDs – Alternative Use Value cannot be reflected
• 2024 RENT DOES NOT FALL BELOW INTIAL LEVEL OF NOTIONAL RENT PAID TO THE CONTRACTOR

Question 3

What is a different between the 2004 and 2013 PCD?

Answer 3

For 2013, only look at current use, if 2004 can look at the use which will have a higher value.

Question 4

What are the different ways surgeries can be owned?

Answer 4

Owned by NHS.
Owned by LL - rent reimbursed
Owned by GP - notional rent reimbursed.

Question 5

What is schedule 2 of the PCD?

Answer 5

Schedule 2 of PCD: basis for CMR
- Assumes willing negotiations between GP & Tenant.
- Ignoring fact that the rent agreed is reimbursed and that only one GP is permitted in the market.
- Is assessed in a “no DRRS” world but not a “no NHS” world.