Farm tenancies need ‘good communication’ to survive uncertain times
Archant Norfolk 2018
An associate at a property consultancy dealing with farmers and estates around Norfolk says he expects Brexit to have an effect on farm tenancies.
Edward Fitzalan-Howard of Savills in Norwich told a gathering of agricultural professionals at Barningham Hall near Matlaske that the days of longer farming contract agreements were “pretty much gone” and that both landowners and tenant farmers would need more flexibility in future.
“With the realities of Brexit both parties will want flexibility. The tenant farmer will want to make changes to their business the same way that the farmer/landowner will want to make changes to theirs,” he said.
“I think we will see a lot more flexibility for the farmer/landowner and the contract farmer.”
Mr Fitzalan-Howard expected the good landlord-tenant relationships which have prevailed in the past five years to continue post-Brexit.
He said: “Landlords and tenants are more mature and there is a more open view about it. As a result of that we will see more realistic landlords and tenants engaging with each other and trying to understand each others businesses to ensure it works.”
He expected an “adjustment” in rents, adding that “uncertain times” for landlords may help to keep down the number of rent reviews.
Research by Savills released in April shows a significant decline in rent review activity since the referendum, with 84% fewer reviews in 2017 than four years previously.
The reviews completed in 2017 led to an average increase of 7% for Agricultural Holdings Act (AHA) tenancies and 12% for Farm Business Tenancies (FBT), Savills said.
Mr Fitzalan-Howard said: “A lot of landlords have farmed in hand and know the pressures that tenant farmers are under as well.”
He added that improved communication had helped discussion about succession among tenant farmers. “There was a time when a lot of landlords did not want to discuss it which mean tenants did not want to discuss it either, but times are changing and I think it is something that should be put on the table so more businesses can survive for the future,” he said.