Government launches call for evidence into tenant and landlord discussions

The government has launched a call for evidence on the discussions between commercial tenants and landlords to discover whether it needs to take further action to preserve businesses and jobs.

The government’s objective is to understand how landlords and tenants are responding to the build-up of rent arrears that has occurred due to businesses being unable to trade normally during the pandemic.

In response to the disruption and closure of businesses over the last year, including the hospitality industry, the government introduced legislation to prevent landlords of commercial properties from being able to evict tenants for not paying rent, to restrict landlords’ abilities to recover rental arrears through the seizure of goods and to restrict statutory demands and winding up petitions.

These measures are in place until 30 June and include the moratorium on commercial lease evictions established by section 82 of the Coronavirus Act 2020 and the restrictions on the use of Commercial Rent Arrears Recovery (CRAR) established by the Taking Control of Goods (Amendment)(Coronavirus) Regulations 2021.

This call for evidence will support the government’s decision-making on the best way to withdraw or replace these measures while preserving tenant businesses and the jobs that they support.

If there is evidence that productive discussions between landlords and tenants are not taking place, and that this represents a substantial and ongoing threat to jobs and livelihoods, the government said it “will not hesitate to intervene further”.

The government is seeking views from businesses, business representative organisations, commercial landlords, lenders, investors and their representative organisations, commercial property professionals and anyone with an interest in or connection to the commercial property market in England.

It is particularly interested in the views of small- to medium-sized businesses including small commercial landlords, independent businesses and sole traders with leased premises.

The call for evidence is open here until 23:59 on 4 May.

UKHospitality chief executive Kate Nicholls pointed out that, after a year of lockdown and restrictions, rent debt in the hospitality sector has topped £2b and businesses still face months without being able to trade profitably. UKHospitality will be engaging with members and government on a response.

"This level of debt simply cannot be paid off in the short-term," said Nicholls. "There must be sustained and targeted support to allow tenants and landlords to reach agreement. This must include measures from landlords to write off a level of Covid-related debt."

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