Commercial Tenants Will Not Be Evicted During Virus Outbreak
The government has put in new measure to ensure commercial tenants, unable to pay their rent because of coronavirus, will be saved from eviction.
Given the government’s strict new guidance preventing many shops from trading for at least three weeks, a myriad of commercial tenants have already been communicating with landlords and scrutinising their lease agreements to find ways of alleviating the financial burden caused by their rents.
Voluntary arrangements and even force majeure clauses have been looked at to reduce their cashflow burdens. In a similar fashion to mortgage holidays and rental support, businesses will not be forced from their premises if they miss a rent payment over the next three months.
Whilst businesses will still be liable for any missed payments following the three-month reprieve, the government will also continue to monitor the situation for commercial landlords and may intervene in order to help them with reduced cashflow implications.
Communities Secretary, Rt Hon Robert Jenrick MP, said:
“We are protecting both people and their businesses by providing the urgent support they need.
“We know many commercial landlords are already setting a great example by working closely with tenants and offering rent deferrals or holidays.
“However, these new measures will provide reassurance to businesses struggling with cashflows and ensure no commercial tenant is evicted if they cannot pay their rent because of coronavirus over the next 3 months.”
The Chancellor of the Exchequer, Rishi Sunak MP, said:
“We are taking unprecedented action and doing so at unprecedented speed, because we know that businesses and their employees need help now.
“That is why we are taking steps to change the law so that no company can be forced out of its premises due to loss of income. Alongside our support for workers and £330 billion of business loans and guarantees, this will help make a real difference to firms across the country trying to protect jobs.”
Business Secretary, Alok Sharma MP said:
“This measure will provide companies with an essential safeguard in these highly unusual times as they deal with the impact of coronavirus.
“This is part of the unprecedented package of support we have put in place to protect jobs and livelihoods right across the country.”
Mike Cherry, Federation of Small Businesses National Chairman, said:
“Small businesses will wholeheartedly welcome the decision to ban evictions for commercial tenants for 3 months.
“This will give piece of mind to millions of small businesses who are desperately struggling with their cash flow.
“We know sensible conversations between landlords and commercial tenants are taking place – but having this legislative backstop to prevent evictions during the worst of the crisis will provide much needed peace of mind for many small businesses.”