A 26% increase in business rates has put 21 of London’s 94 grassroots music venues at risk of closure, according to new research.

Crowd surfing at a packed gig
Cosmic Dead crowdsurf at The Lexington in Islington, which is now at risk of closure

Soaring business rates have put 21 grassroots music venues in London at risk of closure, researchers have warned.

The total business rates bill for the capital’s 94 grassroots music venues rose by 26% when the new charges came into effect on 1 April. For almost a third of venues this meant an increase of £10,000 or more.

The Mayor of London is calling for grassroots music venues to be protected and for business rates to be fully devolved to London, as they are to Scotland, Wales and Northern Ireland.

The news is a blow for campaigners who have been trying to stem the tide of closures of grassroots music venues in recent years – there are 50 fewer venues in London now than in 2007. While a report released earlier this year found the number of venues was finally stabilising, the new research suggests turbulent times are ahead.

Serious challenges

The research, compiled for the Mayor of London by Nordicity, reveals that a further 18 venues are expected to experience serious challenges by the rates increase, and 23 may have to make programming changes to encourage higher ticket sales.

The changes could see venues increasing ticket prices, cutting jobs and eliminating as many as 14,000 emerging-artist performances annually.

“It is becoming harder and harder to run a normal business around here and we keep having to think of different ways to generate revenue,” said Jeff Horton, owner of the 100 Club, which has seen its annual business rates rise by around £20,000.

“I worry about where the new up-and-coming bands are going to come from – if you look at the major festivals it is often the veteran bands who headline them and that is partially because there aren’t as many grassroots music venues that nurture talent as there used to be.”

Mayor’s response

The Mayor of London Sadiq Khan is calling on the Valuation Office Agency to review its valuation policy for grassroots music venues.

“The way in which the business rates are evaluated for London’s grassroots music venues doesn’t make sense,” he said. “It is completely unfair to bill a business based on the size of its building and not to take its profits into account.

He is also calling for London’s 33 billing authorities to use some of the £72.5m they will receive from central government in 2017-18 to offer rate relief to small businesses including grassroots music venues.

Vulnerable venues

Business rates are based on the Valuation Office Agency’s assessment of a property’s rateable value, drawing on its size and location. This is the first time rates have been revaluated since 2010.

The research warns that grassroots music venues are particularly vulnerable to rates increases, as they need large buildings in urban centres, where property prices have risen sharply in recent years.

The 100 Club is located on Oxford Street, and other venues classed most at risk include the Lexington and the Macbeth, which are both in Islington.

“I am not sure the Government realise the damage they are doing with these business rates increases,” said Jeff Horton. “The impact of this on grassroots music venues is going to be huge and will make it very hard for many to survive.”

He added: “London is one of the most visited cities in the world and people come here because of our incredible arts and cultural heritage. If that falls off a cliff edge, everyone will suffer.”

Commercial theatre operators have also spoken out about how they will struggle to cope with the business rates revaluation.

A photo of Frances Richens