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Shouler & Son is advising clients to think laterally in the fit-out of farm sheds for alternative uses to meet the growing demand.

In the firm’s recent mid-year review, Shoulers’ commercial property team reported on the appetite of investors and occupiers for industrial units in a farm setting.

These units are often commanding a minimum of £5 per square foot (psf), and achieving yields of over six per cent in many instances across the firm’s East Midlands patch.

Since April 2018, it has been unlawful for a landlord to market a lease or to renew a lease in a commercial property with an EPC rating below Band E.

Anticipation of legislation that might see commercial - and also residential - property with an energy performance rating below the current minimum level becoming unlawful to let from 2025 could have an impact on this sector due to costs for insulation, plus other measures to bring the buildings up to any new required rating.

The original purposes for which farm sheds were intended mean, by design, most were not heated nor were they highly energy efficient.

The cost of retro-fitting to upgrade enough to achieve any new minimum energy performance rating could be prohibitive enough to make alternative business premises use commercially unviable for these on-farm properties in the long term.

However, innovations in the commercial fit-out market that centre on pre-fabricated, factory-produced modular units to slot inside a farm shed shell could offer a solution.

While not being mass produced presently, suppliers are beginning to market modular commercial fit-outs for this purpose more widely.

It is a trend Shouler & Son is keeping track of in advising rural clients who are looking to make best use of redundant farm buildings.

The firm’s Head of Commercial, Harry Baines, said, “Shortage of industrial units across the piece means farm sheds for non-farming business uses offer an attractive proposition.

“However, to sustain both the supply and demand for such units - whether that’s as a landlord beyond any 2025 regulatory changes or as an occupier looking to the reduce energy running costs - a pre-fab, modular approach to farm shed fit-outs could prove a very canny commercial move for owners of such rural units.”

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