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Chairman’s statement on rent reviews

Last month I published a statement on the Scottish Land & Estates website which announced that my own family business, Annandale Estates, is in the process of conducting rent reviews across a number of our farms.

Unsurprisingly, the very fact that the estate was conducting rent reviews attracted interest and commentary and this week the Scottish Tenant Farmers Association issued a media release criticising our approach and suggesting that the estate had not followed the industry guidance to which Scottish Land & Estates is a signatory.

In response to their comments, I issued this further statement to the media and this has been featured in The Scottish Farmer’s story.

“I issued a statement last month on the rent reviews being held at Annandale Estates and I firmly reject any accusation that we have ignored the joint guidance on rent reviews to which Scottish Land & Estates is signed up to. Such a suggestion is wholly misleading. 

"As previously stated, these are the first rent reviews at the estate for four years, with the aim of achieving a fair rent for both the tenant and landlord reflecting the individual circumstances of each farm, and at the same time effectively conducting the amnesty to list the tenant’s improvements so that they form no part of any rental calculation.

"For these latest reviews we have followed the joint guidance in producing comparable evidence from across the sector. From our discussions with the Scottish Land Commission during this process, we have agreed with them, with a view to making negotiations more amicable with the tenant, to provide further information on the data that has been used in our research.

"Following the estate providing its written evidence, the guidance makes clear that it is incumbent on the tenant or their agent to provide their comparable evidence as part of their counteroffer to the estate. This has not yet happened, but we are still within the guidance timescales and we await that response which would then allow us to make progress towards finding a mutually agreeable outcome. Everyone involved in rent reviews knows that there is a negotiation process, with both parties providing evidence, and the estate's opening correspondence is part of presenting that evidence and should not be distorted by some as the estate issuing a final new rent bill.

“At this stage, only two reviews of 15 in total have been completed, one of which has seen no increase in rent and the other which has seen an increase which both the tenant and the estate is content with. We remain in dialogue with other tenants and the estate has been clear that we are happy to see larger increases phased in over a period of time.

"We also reject the suggestion, put forward by Angus McCall and the STFA, that the guidance prevents an increase beyond the rate of CPI. The STFA is deliberately misinterpreting the joint guidance which states that CPI is not to be used as a limit but instead to be used as a sense check during this process to ensure a fair market rent.

“It should be noted that across the 15 farms we are reviewing, 10 would still have rents in four figure sums, all of which also involve residential property. We believe this process will deliver fair market rent, in accordance with the guidance, and represents good value. The estate, and I personally, value the work of tenants and the relationship we enjoy with them and we are continuing to engage with them to establish an agreeable position for both parties."

Needless to say, I am disappointed by erroneous allegations made by STFA. If any member of Scottish Land & Estates has any concerns over this issue or the manner in which I have dealt with this matter as your chairman, please do get in touch with me and I will happily discuss all aspects of the matter.

David Johnstone

Chairman, Scottish Land & Estates


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