In the past the two types of property, garages and filling stations, were often on the same site and run by the same proprietor. This is becoming less common. The two types of business have been moving steadily away from each other in the last 20 years and in this sixth edition the two are dealt with separately with an additional section covering service areas. The chapter is divided into three parts:
• Part 1 Petrol filling stations • Part 2 Motorway service areas • Part 3 Garages
Both garages and petrol filling stations have one thing in common — they have seen a substantial reduction in their numbers in the last 30 years. The traditional garage has been steadily losing ground to a growing number of specialist fast-fit businesses which now dominate the market in tyres, exhausts, shock absorbers, batteries and windscreen replacement. In 1975 there were 10,500 franchised garages in the UK. A number of motor manufacturers have sharply reduced these numbers so that by the turn of the century there were fewer than 6,000 at which stage they were outnumbered by fast-fit centres. Similarly the number of petrol filling stations in the UK has fallen sharply and the survivor sites
tend to be larger, well laid out and capable of generating substantial non-fuel revenues and the oil companies are eagerly setting about transforming themselves into general roadside retailers. This might be a long-term, defensive strategy as the arrival of new forms of power generation for the car becomes more possible with pressure for zero-emission increasing. A surveyor may be required to carry out valuations and conduct negotiations in connection with the
purchase or sale of both categories of property and deal with new lettings and rent reviews. In the past it was rare that petrol filling stations were bought for investment purposes. Because their value is related to annual throughput they have been regarded as vulnerable to bypasses and traffic management schemes which can rob them of important traffic flow. However, more conventional types of investment properties suffered greatly in the recession of the early 1990s and the financial standing of tenants became much more important to investors so that there is more interest now in petrol filling stations as investments, particularly when the tenant is a major oil company. The same cannot really be said of garages. Even the best of the listed motor groups have market capitalisations which are tiny by comparison with the oil companies. Some motor groups have nevertheless arranged sale and lease-backs on some of their garages. This has been achieved usually by accepting artificial
rent review provisions so that the rent at review is raised in a formula related to the Retail Price Index, or to another type of property such as off-centre retail stores.