Changing from AHA to FBT

Be robust in rent negotiations
I have served notice before on an aha and an fbt and got rent reduction on both it is possible do not be defeatist

Before serving notice or receiving notice take out insurance for cost of rent review it is not that expensive

Tenants need to be careful not to accept a small increase and have to wait 3 years for the next review and set a precedent for land agents to use against other tenants

Imho land lords agents should be worried because every tenant I speak to say if there is no area payment they will need a rent reduction to carry on their income is a percentage of rent
Land lords will not want to farm the land them selves because that will give a lower return than than with a good tenant in the long run
 

Brisel

Member
Arable Farmer
Location
Midlands
As farm incomes fall as BPS is phased out there will be a time lag before rents fall. It will be interesting to see if tenants can put a descending rent escalator in linked to BPS payments if the Agriculture Bill gets into law.
 

egbert

Member
Livestock Farmer
It's easy to slam landlords (I'm both landlord and tenant, although mostly large AHA tenant)(large farm, not large tenant)
I try to make it my business to be a profitable, non troublesome tenant - and preferred to be treated likewise when the boot is on the other foot.

On an estate committed to long term sound management it seems to work, although if yer landlords a chancer, i don't suppose it pays to be quite as philanthropic
 

Rowland

Member
Hi folks. I am currently a second generation tenant with my son set to take over as I retire. From our end, we think all succession tests will be satisfied for him to take over the AHA tenancy.
Landlords have offered us the next door unit, which would double our farm size. But they want us to have the lot on an FBT. There would be a total of two farm houses and two cottages. Both cottages currently occupy retired workers of ours and are in need of modernisation.
The extra farmhouse would be nice for my recently married son to bring up a young family in, he is currently renting a property. It would allow me and my wife to stay in the current farm house.
The extra capacity would be nice, but we are aware this situation is a lot more beneficial to the land lord than us.
My son is 30 so would want a tenancy to see him through to retirement age.?
What should we ask for off the landlord? Ownership of a cottage? Or two cottages?
This has only just been mentioned by the landlords so no idea of any details. Will seek advice from the TFA asap.
Initial thoughts from everyone would be great though.
Generally the thought of changing from AHA to FBT fills me with dread.
How has this gone? Have you made any decisions yet
 

Boerseun

New Member
Personally I would never change or get rid of any AHA agreements. Keep it you have a lot more rights and can actually say no.

We are on a FBT and now on a rolling 24mnth contract. Meaning we can be given notice and have to vacate quickly and rent reviews happen too often.
 

Stockwell

Member
How has this gone? Have you made any decisions yet


Not much progress yet. Getting blood out of stone would be a similar process to dealing with these agents.

Recent meeting has resulted in the agents saying that the owners want to see our plans/cash flows/budgets for the next few years and to enable them to see our plans for expansion and progress. This will enable them to make a decision how we can expand on the estate. They also asked for last years accounts....but said this wasn’t essential if we thought it too intrusive. What are people’s thoughts on this? Don’t want them knowing too much - if our figures look good they’ll be hunting for more rent, if the figures don’t look good it might not instill confidence in them for our future. They insist that the a mutually beneficial agreement can be made without us good down the official retirement notice route.

With regards to agents, any recommendations for very good tenancy agent? Would it be better to have someone out of the area? Wer south shropshire border. Land lords agents are balfours
 

7610 super q

Never Forgotten
Honorary Member
Don't give any financial information, but surely the LL needs to know your plans ? No point them spending ££££££ on a new cattle shed, if your going to be keeping hens.......
 

Stockwell

Member
Don't give any financial information, but surely the LL needs to know your plans ? No point them spending ££££££ on a new cattle shed, if your going to be keeping hens.......

I agree. We’ve been very open about where we want to be in 5 - 10 years time etc. Was just the financial info I was querying

Thanks
 

Brisel

Member
Arable Farmer
Location
Midlands
TFA will have a list of decent agents.

The landlord has no right to ask for your accounts. The veiled threat of a retirement notice would put my back right up and make me want to tell them to get fudged! By all means punt a few partial budgets over for planned enterprises - just make sure they don't look too lucrative ;)

I don't see a problem with a qualitative discussion about your future plans - perhaps suggest the LL comes for an informal cup of tea and a chat without the parasites agents?
 

Stockwell

Member
Although we are yet to be presented with an official proposal, we have been given an outline.
The landlords would like us to surrender our AHA on 350 acres (split in three separate blocks) and take on a 700 acre ring fenced unit on an FBT for 35 years. My wife and I would remain in the current farmhouse, no details of rent/length of time etc for this have been discussed yet.
My son would move to the new unit which includes a large well kept farmhouse and large range of modern cattle housing. As I’ve said, no details have been discussed yet, this is too take place over the next few months.

Made contact with the tfa and the have recommended a local professional who is extremely experienced in tenancy matters/law.

No doubt the size and quality of this farm would take the farming side of our business forward considerably. But obviously the times we live in our more uncertain than ever.

Any advice is much appreciated, the landlords have ‘stressed’ how good this would be for us but I’m under no illusion that the benefits to them are great as my son could remain on this aha for maybe another 50 years if our succession application was successfull.

So what should we look for? The rent formula calculation is a major one for us so we don’t get hit with ‘digester rents’
Thanks again
 

DRC

Member
I think you can agree an FBT, but with rents based on an AHA, but someone like Phillip Meade will know the ins and outs better than any of us on here.
One thing you could consider is ask them to give or sell you cheaply, your farmhouse as part of the deal. This happened with us when they wanted our old village site for development and moved us to a new site with me as tenant. Dad got the farmhouse on the old site for a nominal fee of £10.
 

Flat 10

Member
Arable Farmer
Location
Fen Edge
Although we are yet to be presented with an official proposal, we have been given an outline.
The landlords would like us to surrender our AHA on 350 acres (split in three separate blocks) and take on a 700 acre ring fenced unit on an FBT for 35 years. My wife and I would remain in the current farmhouse, no details of rent/length of time etc for this have been discussed yet.
My son would move to the new unit which includes a large well kept farmhouse and large range of modern cattle housing. As I’ve said, no details have been discussed yet, this is too take place over the next few months.

Made contact with the tfa and the have recommended a local professional who is extremely experienced in tenancy matters/law.

No doubt the size and quality of this farm would take the farming side of our business forward considerably. But obviously the times we live in our more uncertain than ever.

Any advice is much appreciated, the landlords have ‘stressed’ how good this would be for us but I’m under no illusion that the benefits to them are great as my son could remain on this aha for maybe another 50 years if our succession application was successfull.

So what should we look for? The rent formula calculation is a major one for us so we don’t get hit with ‘digester rents’
Thanks again
Although tempting I don’t think I would rush into it. Depends how your son feels.
 
Although we are yet to be presented with an official proposal, we have been given an outline.
The landlords would like us to surrender our AHA on 350 acres (split in three separate blocks) and take on a 700 acre ring fenced unit on an FBT for 35 years. My wife and I would remain in the current farmhouse, no details of rent/length of time etc for this have been discussed yet.
My son would move to the new unit which includes a large well kept farmhouse and large range of modern cattle housing. As I’ve said, no details have been discussed yet, this is too take place over the next few months.

Made contact with the tfa and the have recommended a local professional who is extremely experienced in tenancy matters/law.

No doubt the size and quality of this farm would take the farming side of our business forward considerably. But obviously the times we live in our more uncertain than ever.

Any advice is much appreciated, the landlords have ‘stressed’ how good this would be for us but I’m under no illusion that the benefits to them are great as my son could remain on this aha for maybe another 50 years if our succession application was successfull.

So what should we look for? The rent formula calculation is a major one for us so we don’t get hit with ‘digester rents’
Thanks again

Sounds a good propersition but and a very big but
you need to get the best agricultural layer to make sure you rental formula and security is completely water tight
you or your son also need to be able to get out if you want to if circumstances change aha only have a 1 year notice if you want to give up
if you get it right and having worked with the land lords and agents the opertunities going forward could be exciting

on a more general not the future for farming outside the eu is very volatile so and aha rents could be no less than fbt in 10 years time
 

Stockwell

Member
I think you can agree an FBT, but with rents based on an AHA, but someone like Phillip Meade will know the ins and outs better than any of us on here.
One thing you could consider is ask them to give or sell you cheaply, your farmhouse as part of the deal. This happened with us when they wanted our old village site for development and moved us to a new site with me as tenant. Dad got the farmhouse on the old site for a nominal fee of £10.
Your landlord sounds a lot fairer than I think ours (or his agents) will be, don’t think We’d be able to manage a negotiation like that
 

SFI - What % were you taking out of production?

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Red Tractor drops launch of green farming scheme amid anger from farmers

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As reported in Independent


quote: “Red Tractor has confirmed it is dropping plans to launch its green farming assurance standard in April“

read the TFF thread here: https://thefarmingforum.co.uk/index.php?threads/gfc-was-to-go-ahead-now-not-going-ahead.405234/
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