Food Processing Centres
Source: gov.uk (2025-05-16)

This publication is intended for Valuation Officers. It may contain links to internal resources that are not available through this version.

1. Scope

1.1. This guidance applies to factories, workshops and warehouses, there are separate practice notes for food processing centres, creameries, large distribution warehouses and large industrials linked to this section.

Wholesale warehouses (Scat 301), self-storage hereditaments (Scat 721) and builders merchants (Scat 994) are the subject of separate manual sections.

2. List description and special category code

3. Responsible teams

3.1. Factories, workshops and warehouses are a generalist/regional class, large distribution warehouses are dealt with by the specialist/national teams.

3.2. It is recommended that each Unit should allocate a named co-ordinator to act as a point of contact within the Unit. This lead valuer will assist in the delivery of the Unit’s valuation scheme and also for liaising on value and technical issues with other lead valuers across adjoining Units.

4. Co-ordination

Factories, workshops and warehouses (SCAT 096) fall within the responsibility of the Regional Industrial Class Coordination Team (CCT), along with many sub classes (e.g. Builders merchants, Tyre and exhaust Centres, Wholesale warehouses). Large distribution warehouses and Large industrials fall within the responsibility of the Industrial specialist - rentals CCT.

Caseworkers have a responsibility to:
- follow the advice contained within the Rating Manual and relevant practice note
- seek advice from the co-ordination team before starting on any new work
- not to depart from the guidance given on appeals or maintenance work, without approval from the co-ordination team
5. Legal framework

There is no specific legal framework for this class.

6. Survey requirements

Factories, workshops and warehouses should be measured and valued to Gross Internal Area (GIA) having regard to the definitions contained in the VOA Code of Measuring Practice for Rating Purposes.

7. Survey capture

Rating surveys should be captured on the Rating Support Application (RSA). Plans and surveys should be stored in appropriate folder within the Electronic Document Records Management (EDRM) system.

8. Valuation approach

Rental and rental comparison approaches should be used.

Rental evidence for this type of hereditament exists. The class co-ordination teams are available to assist with rental analysis for the sectors covered by a CCT.

9. Valuation support
- Rating Support Application (RSA)
- Class co-ordination team (CCT)
Appendix 1 - Inspections

1. Overview

1.1. The VOA standard of measurement for factories, workshops and warehouses is Gross Internal Area (GIA). An explanation of measurement to GIA can be found in the VOA Code of Measuring Practice for Rating (https://assets.publishing.service.gov.uk/media/63bee58fe90e0771bb4260d4/s3p2_The_Code_of_Measuring_Practice.pdf).

1.2. The Code of Measuring Practice e-learning provides useful information on measuring industrials and can be found on the NDR Learning Homepage.

1.3. Industrial properties come in all shapes and sizes, from small workshops to huge manufacturing sites. There are many hazards to consider so you must follow the site rules and use your personal protective equipment.

2. External features

2.1. The Site

A pen picture should be provided of the locality that notes the following:
- Location
- Situation
- Advantages
- Disadvantages
2.2. An example might be:

“The property is situated on an established industrial estate with good access via an existing made-up road also serving other parts of the estate. There are good main road and rail links nearby but parking on site is limited.”

3. Access, loading and unloading facilities

3.1. Ease of access to and within the property should be noted. The height and width of all access doors must be recorded, together with details of construction and the method of operation (e.g. metal roller shutter, electrically operated). The presence of dock levellers should be noted.

3.2. The position of all access doors must be shown on the plan and any problems with access that may affect loading and unloading or general access recorded.

3.3. The height and width of access doors is important not only to the daily operations at the property but also with regard to plant and machinery.

4. Car Parking

4.1. Note the number of allocated car spaces or calculate the approximate size of the overall parking area together with details of the surface finish.

5. Ancillary Storage Land

5.1. Any ancillary storage land should be measured separately and the surface finish noted. Any land suitable for storage, which is unused, should also be recorded. Ask the occupier if the land is used exclusively by them or is shared. If shared make a note of the area and details of the other occupiers.

5.2. It is important to be aware that there are many different approaches to the way in which ancillary land is valued. It is important to be aware of which approach applies to each area. If in doubt please ask your technical advisor.

5.3. Where there are temporary buildings, cabins and/or storage containers (SCN) etc. located on land, then the area of this land must not be deducted. The value of the temporary buildings and/or storage containers and the like, must be added in addition to the land value. Depending on the circumstances, this can be done in the valuation either by a suitable line entry or by using other additions. Other additions is the preferred approach.

6. Age

6.1. It is important to correctly identify the age of any property when carrying out an inspection. The occupier should be able to give you information on the age of the property. If you are unable to obtain this information take photographs to allow identification. The Industrial Age Recognition Guide is a useful tool to help identify the age of your industrial property.

7. Internal features

7.1 Ancillary Accommodation

You should note any ancillary accommodation that may be available e.g. office space, toilets, washrooms, canteens etc.

7.2. Measuring to GIA, ancillary accommodation within the same building may not need to be separately measured if it is of similar quality and value as the main space. Only note the facilities and finish.

7.3. Office space within solid walls or on mezzanine/1st floors, or areas of differing quality will need to be measured.

8. Heights

8.1. The height of an industrial property can have a significant effect upon the value. Eaves height is often used in industrial scales to determine value.

8.2. To record a height note it on the plan at the point it was measured and circle it to distinguish it from the linear measurements.

8.3. The following diagrams show three different types of height in traditional and modern industrial units. The Inspection Checklist only requires you to note the eaves height, which should be measured internally. If the clear height is significantly lower than the eaves height, this might affect the value of the property so should also be recorded.

Diagrams of three different types of height in traditional and modern industrial units. (https://assets.publishing.service.gov.uk/media/63bee837d3bf7f6c27b46c72/RM380_appendix_1_Image1.jpg)

The following diagrams are added for clarity and show the points of measurement for internal eaves height and clear height. It is worth noting that some letting brochures will only state clear height (measured to the underside of the eaves haunch).

Diagrams of the points of measurement for internal eaves height and clear height. (https://assets.publishing.service.gov.uk/media/63bee879e90e0771b49f1cbb/RM380_appendix_1_Image2.jpg)

8.4. Definitions of heights can be found in the VOA Code of measuring practice: definitions for rating purposes. Those for internal eaves and clear height are reproduced below.

8.5. Internal eaves height: the height between the floor surface and the underside of the roof covering, supporting purlins or underlining (whichever is the lower) at the eaves on the internal wall face.

8.6. Clear height: the height between the floor surface and the lowest part of the roof trusses, ceiling beams, roof beams or haunches at the eaves.

8.7. The RICS code of measuring practice has similar definitions with an explanatory diagram which is shown below for reference.

Explanatory diagram for RICS code of measuring practice. (https://assets.publishing.service.gov.uk/media/63bee89ed3bf7f6c2065dc66/RM380_appendix_1_Image3.jpg)

8.8. There may be a number of buildings on the site all with different internal eaves heights in which case separate survey units may be needed to record differing heights.

9. Floor

9.1. Differences in the loading capacity of floors should be recorded. Limitations on the load carrying capacity of the floors (particularly 1st floors and mezzanine storage platforms) should be noted, where available, as this may restrict the full use of the floor.

10. Mezzanine

10.1. A Mezzanine is a “Supported First Floor” (SFF) a floor or series of floors installed independently inside part of the of the main building.

10.2. The construction details, method of access and the clear height above and below the SFF should be recorded, the area below is usually shown as a separate item and deducted from the overall GIA of the ground floor.

10.3. Where possible you should record the load carrying capacity of the Mezzanine floor. This can usually be found on a plate attached to the steel support framework.

11. Bay widths and stanchion grids

11.1. A note should be made of any item, which restricts clear floor space. Columns, piers, pillars, stanchions etc are all included within the GIA and there is no need to take individual measurements of these features. The number, their approximate positions and sizes should be shown on the plan. Where pillars or stanchions form a grid within an area the grid widths should be shown.

12 Lighting

12.1. The provision of natural and artificial lighting must be recorded. For example ‘’Clear Perspex roof panels and suspended strip lights’’.

13. Plant and machinery

13.1. Industrial property, particularly workshops and large factories, are the bulk property where the majority of Plant & Machinery can be found.

Practice note: 2023 - Food processing centres

1. Market appraisal

1.1. The food and drink manufacturing sector is one of the largest manufacturing sectors in the UK. Demand is buoyant and the industry has experienced growth over the last five years. In 2020, the food and drink manufacturing industry had a turnover of more than £105bn accounting for almost 20% of total UK manufacturing.

1.2. Market conditions, regulatory changes and technological advances, have resulted in increased capital investment. Many occupiers have upgraded or expanded existing facilities.

1.3. Production techniques are labour intensive, and it is not unusual to find that producers cluster together in a locality to take advantage of local labour markets. Some industrial estates may be dominated by food producers.

1.4. Rent reviews and new lettings that reflect the bespoke fit out for food production will be extremely rare. It is typical for occupiers to take shell units and fit them out to their particular requirements.

1.5. Food processing encompasses a wide range of occupiers and there will be some overlaps with dairies, bakeries, meat slaughter and meat processing.

1.6. The impact of the Covid pandemic on industrial property was marked by considerable variation between sectors – the effect on the rental market of the pandemic and of reported labour shortages in the food and drink manufacturing industry is not known. Industrial values have generally increased during the pandemic, but movement of rental values for food processing centres will vary according to location and the type of buildings present.

1.7. There has been a growth in so called ‘dark kitchens’ – essentially, a commercial kitchen in an industrial setting, generally preparing and then selling food/meals through delivery. Some have a pick-up facility (takeaway). Whilst each should be valued on their own merits, it will usually be appropriate to adopt FPA (Food Preparation Area) line use code for such preparation areas and kitchen elements as this will raise the value by 15% to reflect their better quality; CHL (Chiller/Chill Store) and CLD (Freezer/Cold Store) line use codes should be used for those elements.

2. Changes from the last practice note

The market appraisal section has been updated, otherwise there have been no changes since the last practice note.

3. Ratepayer discussions

There have been no discussions with ratepayers.

4. Valuation scheme

4.1. The basis of valuation is by rental comparison. Values will generally be drawn from the local industrial/warehouse tone.

4.2. Rental evidence is limited, it does however indicate an uplift in value for specialised fit out, over and above that of equivalent industrial premises.

4.3. The local rental tone should be adopted, enhanced by a percentage that reflects the additional value of the food processing and clean areas (see paragraph 4.6). The tone will be adjusted to reflect the individual characteristics of each property.

4.4. Food processing and production facilities require specialised fit out including:
- ‘Clean’ areas for processing/production comprising specialised wall, floor and ceiling finishes
- Air handling systems to clean and filter air
- Enhanced drainage and wastewater treatment
- Cold and chilled storage
- Segregated ‘air locked’ staff changing facilities
- Access corridors and stairs dedicated to accessing ‘clean’ areas
4.5. It is important to properly account for the extent of tenant’s fit out, when analysing and adjusting rents and subsequently valuing the hereditament. Care should be taken to identify the tenant’s fit out works. It is not uncommon for first floor extensions used for staff accommodation and changing areas for example, to be a tenant’s improvement. The appropriate measuring practice is Gross Internal Area (GIA) and this will bring into consideration areas such as corridors and stair wells.

4.6. Areas benefitting from ‘white wall’ food processing fit out, must be captured as accommodation use code FPA. A factor of 1.15 should be applied to these FPA coded areas.

4.7. Cases of doubt should be referred to the National Valuation Unit Industrial Commercial and Crown team for advice.

4.8. Additions for car parking should follow the local tone. It is accepted that in certain circumstances it may be appropriate to deduct for ‘lack of adequate parking provision’ and there may be some cases, where an addition could be appropriate - but these will be exceptions.

4.9. Land (as an ancillary to an Industrial hereditament) -the VSA standards definition requires that all land within a hereditament is identified and appropriately captured.

4.10. This will ensure that no “notional” allowances or deductions are made from the gross area of land actually used for and identified as open storage

4.11. Eaves height - the effect on value of an eaves height greater or less than ‘normal’ is essentially a local market interpretation issue.

4.12. It is recommended however that the adjustments for height in all large industrials should be checked in a reconciliation exercise. This will ensure that the intended result is achieved by the method of adjustment adopted and embedded in the survey data. The following matrix is intended to aid thinking and not to constitute a definitive guide.

4.13. If food processing is taking place in a building, with taller eaves than is apparently required to house the specialised clean production areas, no reduction should be entertained on that account.

4.14. Fire protection (sprinklers) - a value addition should continue to be applied through the line entry or survey unit adjustment. The factor should be 1.05. Where tanks and pumps are present in support of the system, these must be valued in addition as plant and machinery, in accordance with the VO Cost Guide.

4.15. Heating - in the absence of information, food processing centres should be assumed to be unheated and valued accordingly. It is likely that heating will be a tenant’s addition, unless scrutiny of the individual facts reveals otherwise.

4.16. Air conditioning - where this is present in ancillary office areas it should be valued at a factor of 1.10.

4.17. Air handling systems serving the ‘clean’ areas will generally not be rateable as per the ‘manufacturing operations or trade processes’ exception, within Class 2 of the Valuation for Rating (Plant and Machinery) (England) Regulations 2000.

4.18. In cases of doubt please discuss with your Technical Advisor or National Valuation Unit Industrial Commercial and Crown team.

4.19. Other plant and machinery. Items likely to be found include high voltage electrical supply, standby power, supports and bases for machinery, walkways, bunds and tanks. These should be captured and valued in accordance with the plant and machinery guidance found in the Rating Manual Section 6: Part 5 (https://www.gov.uk/guidance/rating-manual-section-6-chhallenges-to-the-rating-list/part-5-plant-and-machinery). The Statutory Decapitalisation Rate must be used in valuing P&M as an addition.

Practice note: 2017 - Food Processing centres

1. Market appraisal

The appetite for ready meals, both chilled and frozen, remains healthy in the UK. Some reports put the total UK spend on this sector at around £2.5bn in 2013.

Production techniques are labour intensive and it is not unusual to find that producers cluster together in a locality to take advantage of local labour markets, some industrial estates may be dominated by food producers.

Rent reviews and new lettings that reflect the bespoke fit out for food production will be extremely rare, it is typical for occupiers to take shell units and fit them out to their particular requirements.

Food processing will clearly encompass a wider range of occupier than cook/chill ready meals, there are some overlaps with dairies, bakeries, meat slaughter and meat processing.

2. Changes from the last practice note

No Practice Note (PN) was produced for the 2010 Revaluation.

3. Ratepayer discussions

There have been no discussions with ratepayers.

4. Valuation scheme

The basic values will generally be drawn from the local industrial/warehouse matrices.

Fitting Out: Food Processing and “Clean” Areas

Food processing and production generally requires specialised fit out, which may include:
- ‘Clean’ areas for processing/production comprising specialised wall, floor and ceiling finishes.
- Air handling systems to clean and filter air.
- Enhanced drainage and waste water treatment.
- Cold and chilled storage.
- Segregated ‘air locked’ staff changing facilities.
- Access corridors and stairs dedicated to accessing ‘clean’ areas.
It is important to properly account for the extent of tenant’s fit out when analysing and adjusting rents and subsequently valuing the hereditament. Care should be taken to identify the tenant’s fit out works. It is not uncommon for first floor extensions for staff accommodation and changing areas for example, to be a tenant’s improvement. The appropriate measuring practice is Gross Internal Area (GIA) and this will bring into consideration areas such as corridors and stair wells which may have previously been ignored on a Net Internal Area (NIA) basis.

Areas benefitting from ‘white wall’ food processing fit out must be captured as accommodation use code FPA.

A factor of 1.15 should be applied to these FPA coded areas.

Cases of doubt should be referred to the NVU Industrial and Crown team for advice.

Car parking

Car parking should be “inclusive” and the reflected table should form part of all access paths.

It is accepted that in certain circumstances it may be appropriate to deduct for ‘lack of adequate parking provision’ and there may be some cases where an addition could be appropriate - but these will be exceptions.

Land (as an ancillary to an Industrial hereditament)

The VSA standards definition requires that all land within a hereditament is identified and appropriately captured.

This will ensure that –

No “notional” allowances or deductions are made from the gross area of land actually used for and identified as open storage

Eaves Height

The effect on value of an eaves height greater or less than ‘normal’ is essentially a local Market Interpretation issue.

It is recommended however that the adjustments for height in all large Industrials should be checked in a reconciliation exercise to ensure that the intended result is achieved by the method of adjustment adopted and embedded in the survey data. The following matrix is intended to aid thinking and not to constitute a definitive guide.

If food processing is taking place in a building with taller eaves than is apparently required to house the specialised clean production areas no reduction should be entertained on that account.

Fire Prevention (Sprinklers)

A value addition should continue to be applied through the line entry or survey unit adjustment, the factor should be 1.05. Where tanks and pumps are present in support of the system, these must be valued in addition as plant and machinery in accordance with the VO Cost Guide.

Heating

In the absence of information food processing centres should be assumed to be unheated and valued accordingly.

It is likely that heating will be a tenant’s addition, unless scrutiny of the individual facts reveals otherwise.

Air Conditioning

Where this is present in ancillary office areas it should be valued at a factor of 1.10.

Air handling systems serving the ‘clean’ areas will generally not be rateable per the ‘manufacturing operations or trade processes’ exception within Class 2 of the P&M Order.

In cases of doubt please discuss with your Technical Advisor or NSU Crown and Industrial.

Other Plant and Machinery (P&M)

The common items likely to be found include high voltage electrical supply, standby power, supports and bases for machinery, walkways, bunds and tanks. These should be captured and valued in accordance with the Plant and Machinery sections of the Rating Manual.

The Statutory Decapitalisation Rate must be used in valuing P&M as an addition.