As the Omicron variant threatens to gatecrash Christmas, tenants in the hospitality, retail, and leisure sectors will once again be worried about the prospect of forced closures.
There are a significant number of unresolved commercial rent arrears disputes from the last set of closures.
- Is it fair for tenants to pay rent for periods they were forced to close? No.
- Is it fair for landlords to have to waive rent for those periods? Also no.
None of this is fair, where neither side is at fault.
So how do you resolve it?
The government’s approach so far has been to encourage landlords and tenants to sort it out amongst themselves.
There have been voluntary codes and landlord enforcement options have been restricted, although this was not enough to resolve an estimated £7.5 bn worth of disputes.
Landlord and tenant dynamics are complicated and often depend on the size and commercial leverage on each side. So, a one size fits all approach won’t work.
A new government initiative aims to resolve the remaining disputes through a statutory arbitration scheme, which allows the arbitrator to look at the particular circumstances of each case.
The scheme aims to avoid tenants going bust due to covid-related arrears, although it is a key principle that tenants should pay where they can.
Want to know more?
Download our guide below and use the handy flowchart to find out if your rent arrears dispute could be resolved under the new scheme, which is set to come into force early next year.
To find out more about the above, please contact me or a member of our Property Team.
