Agricultural Rent Survey

Agricultural Rent Survey
 
Rents For New Farm Business Tenancies

3 June 2016, words by Andrew Teanby

Savills let over 12,200 acres on new FBTs in the year to 31 October 2015

 

The average FBT rents in this report are below some of the rents that grab the headlines; this reflects the diversity of holdings and land, and that many landlords consider factors as well as rent when selecting tenants, such as the tenant’s business plan, skills and husbandry.

Competitive open market tenders continue to deliver the highest increase relative to the previous letting, however enthusiasm for exceptionally high FBT tender rents has been tempered. Where the land was tendered the average increase was 55%, this is partially as the land may have previously been let on an AHA tenancy, which has a different (lower) basis for setting rent.

Where land was re-let to tenants or not tendered the average increase was 14%, this is mostly due to shorter agreements so the rent is revisited more frequently. Overall, in the year to 31 October 2015 rents for new FBTs were 19% higher on average than they were under the previous letting of the holding.

Savills let over 12,200 acres on new FBTs in the year to 31 October 2015; the average letting size was 104 acres, 13% of the lettings were over 200 acres, and there were 18 equipped farms let.

There is considerable variation around the rental average. For example, arable farm FBTs averaged £126 per acre, but over 16% of arable farm rents were over £200 per acre, and mostly in the east.

FIGURE 4

New tenancies: FBT rents agreed by farm type in year to October 2015

 
Figure 4

Source: Savills Research

Farm business tenancies advertised in the national farming press

25,000 acres of land was advertised in the main national agricultural publications and property portals in England and Wales. This is less than in the year to 31 October 2014 when 31,200 acres were marketed.

 

 
Demand remains strong for quality land

▲ Demand remains strong for quality land

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Key Contacts

Andrew Teanby

Andrew Teanby

Associate
Rural Research

Savills Lincoln

+44 (0) 1522 507 312

 

Ian Bailey

Ian Bailey

Director
Rural Research

Savills Margaret Street

+44 (0) 207 299 3099

 

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