New study reveals one in ten commercial properties lie on floodplains by Christine Seib

Commercial properties are more at risk from flooding than residential properties, with 30% located within 250m of a floodplain.

A new study by risk analysis data suppliers ISL assessed the flood exposure of the commercial property and retail sectors.

ISL director Mark Harrison said the results could surprise commercial underwriters, as there was little information available on commercial flood risks.

"In June 2000, the government produced the report National Appraisal of Assets at Risk from Flooding and Coastal Erosion, which assessed the extent of the problem of flooding and tried to put forward a cost benefit for different levels of spending on defences," he said.

"Although it was useful, the report was weak in its analysis of the risk to commercial property and the potential accumulations."

ISL's new study showed that 10% of commercial property lay within a floodplain and another 9% was within 100m of a floodplain.

A further 11% fell within the band 100m to 250m from a floodplain.

Office supply companies, DIY superstores, builders' merchants and carpet stores were the most likely to be flooded, according to the survey, internet cafes, off-licenses video libraries, post offices, convenience stores and newsagents were the safest - interestingly, commercial property estate agents also fell into this band.

More than 18% of the UK's 6,000 supermarkets are inside or close to a floodplain.

Harrison said that certain businesses were historically more likely to be close to rivers or the sea because they relied on the water for transport and power.

"Some supermarkets have purposely been built on cheaper land known to be at risk from a 100-year flood and this has been factored into the design," he said.

"Stores are often designed to be slightly elevated, ensuring that the car park, but not the store will flood.

"That's fine but if the car park or surrounding roads are flooded customers and fresh deliveries may not be able to get through and the business interruption could be quite extensive."

Harrison said ISL was working on a new study of the Thames region.

"It has the largest concentration of assets at risk, yet the flood models currently available have been heavily criticised as being too crude," he said.

"ISL is currently building a very high resolution model to help insurers more accurately assess risk to individual properties and the overall exposure to their portfolios."