Hypermarkets and superstores
Source: gov.uk (2025-02-24)

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 instruction applies to hypermarkets and superstores (SCAT code 139) over 2,500m² gross internal area (GIA) and valued overall. Such stores will usually be occupied by national food retailers. There will usually be on-site parking although this may be controlled by others.

1.2 Definitions

1.2.1 There is not a single standard set of definitions in general use to describe these retail outlets. As a guide a ‘Hypermarket’ is simply a large Superstore. It is normally situated outside traditional shopping centres, but can often be co-located with other retail units in out-of-town retails parks. It would generally exceed 10,000m² GIA and offer a wider range of food, household and non-food goods (such as clothing and domestic electrical goods). It offers extensive, and generally free, car parking.

1.2.2 ‘Superstore’ means a retail unit which has the characteristics of a hypermarket but with the sales offer increasingly concentrated towards food and household items as floor space reduces. It describes units between 2,500m² and 10,000m². Co-ordination needs to be undertaken at the interface between large food stores and superstores.

1.2.3 ‘Large Food Store’ (SCAT code 152) is a retail unit which has the characteristics of a superstore but has a GIA generally in excess of 750m² but less than 2,500m². It offers a limited range of food and household items. See section 520B of the Rating Manual. Co-ordination needs to be undertaken at the interface between large food stores and superstores.

2. List description and special category code

Bulk class: shop

Primary description code: CS9

List description: superstore and premises

SCAT code: 139

Suffix S (Specialist)

Where there are separate assessments within the superstore they should be scat coded as follows and valued in accordance with the Superstores Practice Note Appendix 2 - Superstore Separate Let Out Guidance. Although separate let outs are all Generalist classes any variations or allowances from the Superstore Separate Let Out Guidance see Appendix 2 Practice Note 2021 must be agreed by member of Retail 1 CCT.

3. Responsible teams

3.1 Hypermarkets and Superstores are a Specialist class

3.2 Responsibility for inspection, survey and valuation rests with referencers and caseworkers with specialist training and knowledge in this class within National Valuation Unit NVU.

4. Co-ordination

4.1 The Retail 1 Food and General Retail CCT has overall responsibility for the co-ordination of this class. The CCT are responsible for the approach to and accuracy and consistency of valuations. The CCT will deliver Practice Notes describing the valuation basis for revaluation and provide advice as necessary during the life of the rating lists. Caseworkers have a responsibility to:

Follow the advice given at all times - practice notes are mandatory. Not depart from the guidance given on appeals or maintenance work, without approval from the CCT.

4.2 Co-ordination with upper margin of Large Food Stores (SCAT 152) (750m² to 2,500m²) is required.

5. Legal framework

5.1 There is no specific legal framework for this class.

6. Survey requirements

6.1 Inspections should be carried out in accordance with the Valuation Office Agency Code of Practice.

6.2 Superstores are measured to Gross Internal Area (GIA). It is mandatory that hypermarkets and superstores are referenced in accordance with the Superstores Referencing Guide see Supertstore PN Appendix 1

6.3 It is mandatory that the Superstore Inspection Check Sheet at Appendix 1 of this section is completed for all new properties and maintenance work. Photographs MUST be taken of all building elements and stored in the property folder of the Electronic Document Records Management (EDRM) system.

6.4 Issues around quantum concerning superstores have been discussed with ratepayer representatives. Stores with a Total Area from within the main envelope of the building in excess of 5,500 m² will valued as follows:

First 5500m² TFA scale factor 100%

Next 2500m² SZE scale factor 66%

Next 600m² SZF Scale factor 33%

Remainder SZR Scale factor 10%

6.5 Unit of Assessment

On inspection it is first necessary to consider the Unit of Assessment. Occupations by third parties may meet the criteria for a separate assessment, provided they meet the four tenets of ratable occupation. Such let outs need to be considered on a case by case basis and in accordance with Appendix 2 of the Superstore PN Superstore Separate Let Out Guidance.

7. Survey capture

7.1 Rating surveys should be captured on the Rating Support Application (RSA) and plans and surveys stored in the property folder of the Electronic Document Records Management (EDRM) system.

8. Valuation approach

8.1 The rental method is the primary method adopted for all food based hypermarkets and superstores. Rents are analysed to an overall rate per m². Analysis should exclude tenant’s improvements.

8.2 Superstores are valued for rating as fitted units. Rents for this class of property are frequently on a shell basis. Before any analysis occurs it is essential to discover the terms of the letting in relation to fit out. It must also be borne in mind that a fitted rent on a particular property might not actually reflect the current physical state of that property. It could relate to the historic situation that existed when the original lease was entered into therefore ignoring considerable rateable tenant’s improvements which must of course be reflected in the rating assessment.

8.3 It is universal practice to add a percentage to the shell rent to get to the fitted condition on rent review. The percentages adopted are not agreed and rent review evidence varies considerably. In general an addition of 10% should be made for fit out to shell rents for rating purposes.

8.4 No differentiation in value is made between levels of fit out within the property with one basic rate being applied throughout the store. However, a different factor may be applied to different types of accommodation such as warehousing, cage marshalling and plant rooms. Factors may also be applied to accommodation on upper and basement floors. These factors are all set out in Superstores Referencing Guide see Superstore PN Appendix 1

8.5 Levels of value may evidence a hierarchy of food based outlets within a locality

8.6 The provision for customer car parking is an essential feature of hypermarket and superstore hereditaments, especially in out-of-town locations, both on grounds of planning and store operator requirements. To that extent its presence can be said to be reflected in the value of the stores.

8.7 If car parking is charged, it will be necessary to consider the retained income and this may be an indication that there is a separate assessment. Unit of assessment issues with car parking related to Hypermarkets and Superstores is unusual. For specific guidance on car parking - See Rating Manual - Section 6 Part 3 - Section 200 : Car Parks

8.8 Where the car parking area has been identified as a separate hereditament it should be valued at a level appropriate to the locality.

8.9 It will be exceptional to make any end allowance for inadequate parking availability. It is accepted that at peak times there could be a shortage of spaces.

8.10 Where a petrol filling station is within the curtilage of the superstore and it is occupied by the superstore, it forms part of the superstore hereditament, only where the petrol filling station is outside the curtilage of the superstore, for example separated by a public road should it be treated as a separate assessment.

8.11 Where a petrol station is part of the superstore hereditament it must be valued in accordance with Rating Manual Section 6 Part 3 Section 770. The value of the petrol station element must be recorded as an Other Addition as THP and over written as Petrol Forecourt (The valuation of the petrol station should be carried out on the Non Bulk server in the section Petrol Station Part of another hereditament and the resultant figure included as other addition as described above.)

9. Valuation support
- Rating Support Application (RSA)
- Survaid
Appendix 1 - inspection checklist

Hypermarket and superstore inspection checklist (https://assets.publishing.service.gov.uk/media/67bc987cd157fd4b79adddbb/Inspection_Check_List_-_Hypermarkets___Superstores_Appendix_1.docx)

Practice note: 2023 - hypermarkets and superstores

1. Market Appraisal

1.1 The perceived shift in consumer shopping habits identified in the lead up to the 2017 Revaluation has continued approaching the 2023 Revaluation with consumers moving towards shopping more often in a wider variety of stores. In the face of these changing shopping habits, superstores continue to innovate and adapt with superstore operators reviewing their operations and how they use the space within their stores.

1.2 This has resulted in some operators realigning their use of space, for example changing the emphasis in general merchandise from electricals and home entertainment towards own label fashion and homewares.

1.3 The four retailing channels of online, discount, convenience and superstore/ hypermarket format are now firmly established. The perceived shift in shoppers’ behaviours, with a change to shopping ‘little and often’ as part of a multichannel approach to meet their grocery needs has caused the market to fragment.

1.4 In addition, superstore operators have undertaken other initiatives such as simplifying and streamlining their businesses and focusing on the instore customer experience.

1.5 Against this background there have been relatively few store closures. As has historically been the case, demographics and competition continue to largely influence how a store will perform.

1.6 As there are few acquisitions taking place in the market, open market rental evidence is very limited. There continues to be some activity involving lease restructuring, and in such circumstances terms agreed vary depending upon factors including location, store performance, and possibility of store closure with potential for alternative uses such as residential. Investor demand for UK grocery property has remained relatively strong.

2. Changes from the last Practice Note

2.1 The market appraisal has been updated.

3. Ratepayer Discussions

3.1 Superstores are valued by reference to beacons, and in the previous rating lists this exercise has been undertaken in relation to individual stores, whilst for 2023 Revaluation this exercise will be extended to include beacon towns. Discussions have been held with ratepayer representatives concerning the identity and values of these beacons. As part of those discussions, the valuation approach of larger stores in excess of 5,500m², with particular emphasis on the very largest stores are being considered owing to the changes in the desirability of these stores in the current retail environment.

4. Valuation Scheme

4.1 Superstores are valued by reference to the relevant beacon store values and in accordance with the superstore referencing guide set out at Appendix 1 of this Practice Note.

4.2 There is also a valuation scheme for superstore separate let outs set out at Appendix 2 of this Practice Note.

4.3 Issues around quantum concerning superstores have been discussed with ratepayer representatives. Stores with a Total Area from within the main envelope of the building in excess of 5,500 m² will valued as follows:

First 5500m² TFA scale factor 100%

Next 2500m² SZE scale factor 66%

Next 600m² SZF Scale factor 33%

Remainder SZR Scale factor 10%

Appendix 1 Practice Note 2023 Superstores

Superstores valuation and referencing guide is attached here (https://assets.publishing.service.gov.uk/media/63c96a52e90e0707165d2250/Appendix_1_Practice_Note_2023_Superstores_Referencing_Guide.docx).

Appendix 2 Practice Note 2023 Superstores

Superstore separate let out guidance is attached here (https://assets.publishing.service.gov.uk/media/63c96a79d3bf7f24a8db5746/Appendix_2_Practice_Note_2023_Hypermarket_Superstores-_Separate_Let_Out_Guidance_V2_2022-11-9.docx).

Practice note 2017

1. Market appraisal

1.1 Historically there has been almost continual growth in the food sector in the recent past. Like for like sales of the major operators have generally increased year on year and margins had been maintained. The sector as a whole was buoyant and was largely unaffected by the post 2008 recession. This background helped to explain the increase in floor space brought about by new openings and existing store expansions.

1.2 By mid 2014 forecasts were beginning to cast worries on the superstore market as like for like sales fell. There was also a growing view that problems within the superstore sector were likely to be the result of a permanent structural shift in the particular market that was reported to be suffering from:

a fall in margins, as major price cuts and promotions were brought in to reduce prices negative like for like sales

a rapid increase in new space coming on line at a time when sales growth was reversing competition from discount food retailers

changes in shopping habits – move away from large weekly shop partly economic and partly demographic more smaller households

1.3 Late in the second half of 2014, overcapacity was identified for the first time. An ‘exit capacity’ from underperforming stores was openly discussed, even though values of alternative property uses were not necessarily an attractive proposition.

1.4 Looking behind the headlines, any closures were limited and fell in ‘fairly marginal locations’ and in places that were already well catered for by existing food outlets. Some operators reported they had no plans to reduce store numbers, but where they identified excess space the intention was to reorganise and sell more clothes and homewares or put in concessions such as travel money, phone shops and digital outlets.

1.4 New stores that can take years in planning, do not easily react to changes in the market. However, in late 2014 doubts over the long term outlook were again reflected when a number of the major operators announced that a considerable number of planned new developments would be cancelled. The ‘dash for space’ had come to an abrupt end.

1.5 By 2015 the four retailing channels of online, discount, convenience and superstore/ hypermarket format were now firmly established. The perceived shift in shoppers’ behaviours, with a change to shopping ‘little and often’ as part of a multichannel approach to meet their grocery needs has caused the market to fragment.

2. Changes from the last practice note

2.1 There was no Practice Note for the 2010 Revaluation.

3. Ratepayer discussions

Superstores are valued by reference to beacon stores. Discussions have been held with ratepayer representatives concerning the identity and values of these beacons. These discussions have not been formerly concluded.

4. Valuation Scheme

4.1 Hypermarkets and superstores are measured to gross internal area and valued overall. There is one scaled which applies nationally. A single rate is applied to all areas to reflect all aspects of the store including size, layout, location and age. The valuation scheme is founded upon actual rents and Beacon Values (under discussion for Reval 2017)

Practice note: Appendix 1

Appendix 1: practice note 2017 - superstores (https://assets.publishing.service.gov.uk/media/5ba8f28c40f0b605e88d0420/S520A_Hypermarkets_Superstores_PN_2017_Appendix_1_Referencing_Guide.pdf)

Practice note: Appendix 2 - Superstore separate let out guidance

This supersedes all previous instructions.

No allowances should be given on the main superstore for encumbrance (fragmentation) and no allowance to be given on area of the superstore for circulation space.

The presumption is that all non-supermarket branded occupations should be separate assessments other than Travel Money Kiosks, Community Rooms at Tesco and Waitrose stores and sites of machines including ATMs, photo-booths, coin counting machines, delivery lockers, coffee machines, heart machines, Rug Doctor, all sites of Kiddies Rides.

Tesco branded operations to be separate assessments
- Cafes
- Tesco Mobile - retail units and separate retail areas
Tesco branded operations not to be a separate assessment
- External and hole in the wall ATM sites
- Tesco Opticians (These were sold Vision Express from 4 December 2017 and are therefore separate assessment from that date when occupied by Vision Express.
- Tesco Pharmacy
- Bureau de Change
- In-house clothing brand F&F (Florence and Fred)
- Dot.com
- Click and Collect
Sainsbury’s branded operations to be separate assessments
- Pharmacies – From 1 October 2016 all Sainsbury’s pharmacies were taken over by Lloyds. All instore pharmacies at Sainsbury should be separately assessed from that date.
- Doctors and Dentists
- Argos
Sainsbury’s branded operations not to be separate assessments
- Cafes operated by Sainsbury
- In House Clothing Brand TU Clothing
- Bureau de Change
- External and hole in the wall ATM sites
Asda branded operations not to be separate assessments
- In-house clothing brand George
- Cafes operated by ASDA
- ASDA Pharmacy
- ASDA Opticians
- Bureau de change
Morrisons branded operations not to be separate assessments
- Cafes
- Pharmacies
Survey of separate let outs

General

All superstore separate assessments in an existing host property should be entered into the Rating List by way of a recon except for advert rights which are always to be brought in as a new assessment.

Special process code

The special Process Code SSSA should be added to cases creating separate assessments within superstores. This stands for Superstore Separate Assessment.

Measurement

All Separate Let Outs in superstores are to be measured to Gross Internal Area (GIA). Sites of hole in the wall ATMs and bureau de change need to be measured so that their areas can be deducted from the area of the host superstore.

Matrix

Address Matrices should be used for all separate ‘Let Outs’ other than sites of automatic machines and bureau de change. The rate per m² entered in the matrix should first be calculated using the Excel calculators referred to on page 3 of this guidance.

Scale

Use the General overall scale for shops VXSGPOVERAL1 (2010); VVSGPOVERAL1 (2017) for all separate ‘Let Outs’ including cafes and restaurants (other than sites of automatic machines and bureau de change where specific scales apply).

SCAT Codes (All with Suffix G)
- 500 Cafes/Restaurants within part of a specialist property
- 503 Gymnasium within part of a specialist property
- 504 Kiosks within part of a specialist property
- 505 Nurseries /Crèches within part of a specialist property
- 507 Salons/ Clinics within part of specialist property
- 508 Shops within parts of a specialist property and in absence of a more suitable code
Other additions and car parking

Other Additions and Car Parking: Use dedicated ‘other additions’ table

Valuation of retail let outs excluding cafes and site of machines

General

Retail units are valued according to their size and location within the store.

SUBLOC 2010 and 2017: LOUT used for all retail unit let outs except cafes

Accommodation use code: RAO

Ground floor retail units

The value applied to a retail unit will vary depending upon whether it is Exit Side (in front of the tills) or Store Side (rear of the tills). Any lock up units which front onto the street are valued on the local tone. Yorkon type units occupied by shoe repair/ key cutters for example outside the main building are valued at £6,500 for 2010 and £8,000 for 2017

The plan linked below illustrates what is considered to be Exit Side and what is considered to be Store side

Ground floor superstore indicative layout plan (https://assets.publishing.service.gov.uk/media/5ba8f883ed915d2be42cf5d4/139_Hypermarket_Superstores_PN_Appendix_2_Ground_floor_superstore_indicative_layout_plan.pdf)

Valuation and case remarks

As the value of the Let Out is calculated off system using the calculator referred to below, RSA Case Remarks should record the superstore main price (from which the value of the Let Out has been calculated) and the percentage from the scale. State also whether the Let Out is Front of Tills (Exit Side) or Rear of Tills (Store Side).

Stilted stores - valuation of separate retail let outa

In a stilted store the main trading floor is on the first floor above car park.

For Let outs on main trading floor in Stilted stores use the rate applied to the main space which includes a discount to take account of the fact the property is a stilted store (usually an allowance of 5% is applied to the first floor main space price) For separate Let Outs on mezzanine upper floors in stilted stores, use the same values as for all other superstores.

First floor/mezzanine floor retail units

All retail units are valued in accordance with the table below regardless of their size

Survey of cafes and restaurants General Sublet cafes are valued dependent upon their location. SUBLOC 2010 and 2017: SSLC Accommodation use code: RES

Valuation of ground floors cafes and restaurants All separately let out cafes and restaurants less than 225m² are valued at 100% of Main Space value. Those with an area of 225m² or greater are valued at 90% of Main Space. Valuation of first floor cafes and restaurants All First and Mezzanine cafes are valued in accordance with the table below regardless of size.

Valuation of cafes in stilted stores

For cafes with less than 225m² in stilted stores on main trading floor, value at same Main Space price as main trading area, those with an area of 225m² or greater valued at 90% of Main Space price applied to main trading area. Cafes on floors above main trading areas in stilted stores use same value as first floor cafes.

Valuation of children’s activity centres, creches doctors dentists

Ground floor

Other uses such as children’s activity centres, crèches, doctors, valued at 50% of Main Space price for 2010 and 2017 Rating Lists. Dentists valued at 50% of main space for 2010 List 70% of main space for 2017 List.

First and mezzanine floors

Survey and valuation of all other uses

General

For Bureau de Change use Accommodation Use Code ‘RAO’ and against this code enter the number of Bureau de Change which is normally one. DO NOT record the floor area of the Bureau de Change (this must however be deducted from the area of the host store). For ATMs AUC is ATM against this code enter the number of ATM sites. DO NOT record the floor area of the ATM site (this must however be deducted from the area of the host store).

Advertising rights

Section 20: Advertising Rights, Advertising Stations and Land Used for Advertising (https://www.gov.uk/guidance/rating-manual-section-6-part-3-valuation-of-all-property-classes/section-20-advertising-rights-advertising-stations-and-land-used-for-advertising)

Only those advertising third party products to be separate assessment. These should be brought into list as new and not recon.

Sites of delivery lockers

Click and collect facilities for the host store should not be separately assessed.

Separate assessments are required for third party occupiers and only where the locker is located outside of the store.

SUBLOCS for 2010 and 2017:

BOXA value £450 for poorly located sites at rear of stores often business use rather than public.

BOXD value £1,000 for better located sites at front or inside stores usually for public use.

SCAT: 018 CX Site of delivery locker

Practice Note 3: 2010: Site of Electronic Delivery Lockers (https://www.gov.uk/guidance/rating-manual-section-6-part-3-valuation-of-all-property-classes/section-1120-sites-of-automatic-machines)

Sites of ATM

Supermarket bank ATMs are separate assessments from the host store where they are ‘hole in the wall’ sites and in pods within the car park. Unless situated in their own secure room and they are all occupied same operator, each ATM site should be a separate assessment. If more than one ATM site is situated within a secure room and they are all the same operator, they should be assessed together as one hereditament.

SUBOCS for 2010 and 2017

ATMA to ATMM see relevant PN for appropriate band to be applied based upon the number of sustainable transactions

Practice Note 2: 2010: Memorandum of agreement relating to the valuation of sites of Automatic Teller Machines (ATMs) in England and Wales (https://www.gov.uk/guidance/rating-manual-section-6-part-3-valuation-of-all-property-classes/section-1120-sites-of-automatic-machines)

Practice Note 1: 2017: Sites of Automatic Teller Machines (ATMs): Revaluation 2017 (https://www.gov.uk/guidance/rating-manual-section-6-part-3-valuation-of-all-property-classes/section-1120-sites-of-automatic-machines)

SCAT: 018

Bureau De Change

SUBLOC for 2010 and 2017: TMK1 RV £5000

SCAT: 504 CX Bureau de Change

Gymnasiums

Section 965: Sports and leisure centres (Private) (https://www.gov.uk/guidance/rating-manual-section-6-part-3-valuation-of-all-property-classes/section-965-sports-and-leisure-centres-private)

SUBLOC for 2010 and 2017: LOUT RV will be based upon local tone for this use

SCAT Code 503 Gymnasium within part of specialist property

Matrix see embedded spreadsheet page 4

Petrol filling stations

Section 770: Petrol filling stations (https://www.gov.uk/guidance/rating-manual-section-6-part-3-valuation-of-all-property-classes/section-770-petrol-filling-stations)

RV will be based upon the agreed PFS scheme and valuation will be carried out on NBS.

Tyre and exhaust centre

SUBLOC 2010 and 2017: LOUT RV 2010 and 2017 £15,000

Matrix see embedded spreadsheet on page 4

Hand carwash

Section 190: Car washes (standalone) (https://www.gov.uk/guidance/rating-manual-section-6-part-3-valuation-of-all-property-classes/section-190-car-washes-standalone)

The appropriate SUBLOCs and Matrix must be obtained from the unit in which the property is situated. Values for this type of property are influenced by the potential custom generated by the host store. As a consequence, factors such as the size and location and local demographics of the host store are likely to impact on the value of the of the carwash. Questions on value should be addressed to the CCT.

Solar panels

Where a third party installs and operates and benefits from the Feed in Tariff (FIT) of the installation, valuation advice must be obtained from Utilities Team and the installation must be a separate assessment brought into the list by means of a reconstitution from the superstore.