These have been a very turbulent and uncertain few weeks for businesses and nowhere is this more clear than in the area of rent payments by commercial tenants to their landlords.
Many businesses have, of course, been forced to shut completely and a large number of these are not in a position to pay their rent at all. The government has stepped in promptly to prohibit forfeiture (the repossessing of a property by changing the locks without a Court Order) on a temporary basis and have recently extended this so that landlords cannot use two of their other options, a statutory demand and a winding up petition.
This has been welcomed by tenants but, strange as it may seem, perhaps there should be sympathy for some of the landlords. Many of these are not large institutions but are private individuals like you and me who are trying to make a living and do often have borrowings to repay.
Further, not all the tenants are in a weak financial position and it has been a sad inditement of modern capitalism that many large companies who could easily afford to pay their rent have either refused to pay anything at all or unilaterally gone on to monthly instalments instead. The government surely needs to take steps to make sure that this practice does not continue.
The reality – in our experience – is that most landlords and tenants have managed to reach an accommodation of some kind. The majority of landlords have accepted that there will be no rent paid this quarter (from the end of March to the end of June) and are looking for their tenants to pay this money at some point in the future – when they are trading again. Other landlords and tenants have agreed to move to monthly payments or payment of just a percentage of the rent for the time being.
There are even some enlightened landlords – such as the Admiral Taverns Pub Group – who have cancelled rents entirely for the March/June quarter.
The law is changing all the time in this area and getting poor advice – or no advice at all – can have very serious implications. We at Guest Walker act for many commercial landlords and tenants and will be able to give up to date help on your situation – whether you are a landlord or a tenant. We can also point you in the direction of the financial assistance that may well be there for tenants – both from central government and the local authority – and will, of course, let all our landlord clients know if the government decides to step in and help them in some way.