World-famous recording studio used by David Bowie, Noel Gallagher and Adele says it can’t survive soaring business rates
Is it the day the music died?
Rachel Reeves’s Budget has dealt a “hammer blow” to the music industry as the UK’s world-leading recording studios and small venues warn that soaring business rates will force them to the wall.
One studio head who has worked with some of the countries biggest names, such as Oasis, warns: “50 per cent of studios have already closed and they are where the next generation of the UK’s world-class producers and engineers would be trained.”
Half of the UK’s recording studios that remain operational say they would be forced to consider closure over the next year, according to research for the Music Producers Guild.
Music studios are currently classified as office space for business rates, and are not entitled to the targeted relief enjoyed by other retail, hospitality and leisure sites.
Among those now facing closure is Dean St. Studios, the legendary central London facility where David Bowie and Marc Bolan recorded their 70s classics. More recently the studio has been used by Noel Gallagher, Adele, Florence + the Machine and Ed Sheeran.
Managing director Jazz Lee said the rateable value of the premises, in the heart of Soho, had soared from £38,250 in 2021 to an “unsustainable” £71,500 from next April.
“We’re on a knife-edge as to whether we can stay open or not,” Lee told The i paper. “We had to let three people go this year to cover the extra costs. We don’t know if we can meet the bills at the end of each month.”
Lee said bookings are strong at the Studios but “we can’t pass on the extra costs to artists, often they are new musicians working on their first record”. Lee explains that like so many studios, they can not “price people out” because the studios need to be “working at 85 per cent capacity to meet the costs”.
She said: “It’s a real hammer blow. These business rates are crippling what would be a successful business.”
Lee began her career working with Oasis at the Wheeler End studios in Buckinghamshire and went on to work for Noel Gallagher’s Big Brother record label. She said it was “ridiculous” that studios were classified as an “office space”.
Lee points out its emerging talent that rely on them and not just the big names. “For young musicians, all the equipment they can’t afford is set up ready to go.”
Paul Epworth, the Grammy and Oscar-winning producer, who has worked with Adele, Coldplay and Rihanna, said the rates at his Church studios in Crouch End, north London, are due to increase by £20,000 next year.
“No one would go into this business to make money any more. Studio owners are more like patrons of the arts,” said Epworth, who co-wrote and produced the chart-topping Skyfall James Bond theme with Adele.
“The result is we won’t be able to take on a young assistant engineer next year or I just absorb more costs.”
Epworth added: “If we want to preserve and continue our great musical heritage we need to support the smaller studios which are access points for the next Adele and Ed Sheeran”.
The Church, used by Bob Dylan, Radiohead, Dave and The Weeknd, houses a 72 channel vintage EMI Neve mixing console retrieved from Abbey Road, once used by Pink Floyd, which gives recordings a unique warmth and vintage quality.
“Not many office spaces have one of those,” Epworth said. “You can make a track on a laptop in your bedroom but you need a studio to record ten people playing together or a string section.”
Epworth invited Rachel Reeves to visit the Church to witness its role as a creative facility boosting the UK’s creative industries – “but she would probably find a black hole in the accounts,” he said.
Venues’ tax costs could trickle through to ticket prices
The change to the business rates system is also impacting hundreds of grassroots music venues which are predicted to close in the coming years.
Organisations representing nearly 1,000 live music venues, including grassroots sites as well as arenas, have signed an open letter to Sir Keir Starmer. It warns that over 350 venues are considered at “immediate risk,” which could lead to the loss of 12,000 jobs and 75,000 live music events.
The letter calls on the Prime Minister to offer clubs the same 40 per cent business rates relief scheme that has been granted to film studios until 2034.
The Prime Minister is also warned that ticket prices for consumers attending arena shows will increase as rising tax costs trickle through to ticket prices. Many of these arenas are “seeing 100 per cent plus increases in their business rates liability.”
Mathew Cartlidge, singer with tipped new indie band The Molotovs, who played a Christmas fundraiser for the Music Venue Trust on Thursday, said: “We’re playing this Bush Hall show because it is vital for the music industry that bands have places to play.”
The Molotovs start a tour in the new year, relying on smaller venues as their popularity continues to rise. “The UK is one of the global powerhouses for new music and yet venues are struggling to cover costs,” said Cartlidge. “They are vital for new bands and the Government needs to step in to save grassroots music.”
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The business rate rise was not an accidental side effect of the Budget. Rachel Reeves had been warned by leading music industry figures in the weeks before the Budget that studios would be forced to close if they were not granted an exemption. But the Chancellor refused to give the sector assistance.
The Government has been bombarded with appeals from the music industry in recent days. Backing a “Save Our Studios” campaign, UK Music chief executive Tom Kiehl said: “Our world-leading studios nurture talent, attract global stars to work here and help create music loved by millions across the world. However, many are struggling to survive in the wake of rising costs”.
He says the Government could “deliver them a lifeline by cutting business rates to give them the chance to thrive and help our economy grow”.
The Treasury insisted support was available for studios. A spokesperson said: “With Covid support ending and valuations rising, some firms may face higher costs – so we have – stepped in to cap bills and help businesses, ass part of a £4.3 billion support package.”
Most properties seeing valuation increases will see them ”capped at 15 per cent or less next year, or £800 for the smallest.”
The Treasury also said it was “relaxing temporary admission rules to cut the cost of bringing in equipment for gigs, providing 40 per cent orchestra tax relief for live concerts, and investing up to £10 million to support venues and live music.”
The Who, Mark Knopfler of Dire Straits and Peter Gabriel joined almost 2,000 figures from the music industry who wrote to the Chancellor, urging her to lower business rates on studios, which are currently in the highest tax bracket.
The home of famous recording facilities like Abbey Road, Britain’s world-leading producers, engineers and artists would simply work abroad, the Music Producers Guild letter said. “Without action, British music will no longer be made in Britain,” the body concluded.
