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Government must act on rent before June payments due if businesses are to be saved

18 May 2020 by
Kate Nicholls spokesperson for Hospitality and Tourism Action Group

Government intervention is needed to settle rent disputes during the coronavirus crisis if widescale job losses and business failures are to be avoided in the coming months, UKHospitality has said.

In a letter to the business secretary, Alok Sharma, the trade body has said the moratorium on enforcement action introduced by the government earlier this year has failed to prevent hospitality businesses being "aggressively pursued by a minority of landlords", with winding-up petitions threatened, County Court Judgements and the loss of deposits.

UKHospitality has called on the government to broker a solution at a high-level ministerial summit involving all stakeholders. It has said both financial and legislative intervention will be required to reach a solution that sees tenants, landlords, investors and government share the costs of the crisis, under the assumption that the vast majority of hospitality businesses will be unable to pay rent for the remainder of 2020.

The trade body has said action must be taken before the next quarterly rent date at the end of June.

UKHospitality chief executive Kate Nicholls said: "In June, sector businesses are due to pay nearly £800m in rent, having been forcibly closed and generated no income for over three months. We appreciate that landlords have their own financial pressures and the majority of landlords have been happy to work with tenants to find solutions, but a damaging minority continue to put pressure on beleaguered hospitality businesses at the worst time.

"Having discussed this issue with a vast number of industry bodies, it's clear we need a National Time Out on rent as the vast majority of hospitality and leisure businesses will simply not be able to pay for the rest of the year. The government must step in quickly to help hospitality businesses, landlords and investors find a mutually beneficial solution. We are ready and eager to sit down with all stakeholders to thrash out an equitable solution, with the government acting as honest broker.

"If the commercial rental market collapses, it will be to the long-term detriment of the whole economy and lead to millions of hospitality workers losing their jobs and swathes of businesses permanently closing their doors."

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