A survey conducted by Blick Rothenberg’s remit, which is across all property classes, revealed that of rents collected by landlords in June 2020 an average of 38% of rent remained unpaid ten days after the due date. This figure increased to 47% of unpaid rent for offices.
Heather Powell, a property partner at Blick Rothenberg, said: “A tide of winding up petitions to force payment of rent – or even for the winding up of landlords who have run out of cash – is not going to help the UK economy get back on its feet.”
Powell explained that landlords are not being paid their rent, despite the government’s remarks stating that if tenants can pay, they should. She believes that the chancellor has “done nothing” to help landlords get their rent and that commercial property owners were ignored in the chancellor’s summer statement.
She added: “Tenants need to be reminded, strongly, that rent unpaid in March and June, and rent due in September is still payable, and that where they can make a payment that they should be doing so.
“To incentivise tenants in this position, landlords need to be given a fast track process to enforce payment by these tenants of all outstanding rent and services charges from the end of the rent moratorium in October – with interest and any other financial penalties included in the lease for non-payment of rent.”
Powell explained that if enacted, landlords will then be able to focus on working collaboratively with tenants, including many in the retail sector, whose businesses are in real distress to produce solutions that work for each party in the long term.
Powell said: “Owners of commercial properties are being treated as a bottomless money pit by the government, required to significantly improve the carbon efficiency of their buildings, to contribute to the regeneration of our high streets, and to support businesses who signed leases that they could honour – but choose not to.”
Dr William Masih a director of the British Landlords Associations said: “Commercial landlords have been hit hard in this COVOD-19 pandemic. Residential landlords have the safety net of state benefits when a tenant is not able to pay the rent”.
“Commercial landlords generally are finding it harder to re-let properties, the void period is longer and the business rates on empty properties are adding to the landlord’s financial problems”.
“Many commercial landlords are finding re-letting their property a challenge. It is now common to offer rent-free period with many tenants not wanting to pay any deposit” He said.
Author: Amanda Goldsmith
Date: 11th of August 2020
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