Commercial tenants who miss rent payments as a result of coronavirus crisis will be protected from eviction, the UK government has announced.
The protection for businesses on commercial leases – which will last until 30 June, with an option for the government to extend if needed – will apply to England, Wales and Northern Ireland.
In a statement, the government said the extra protection is alongside its support for workers and £330bn (€359bn) of business loans and guarantees.
It said many landlords and tenants are already having conversations and reaching voluntary arrangements about rental payments due shortly but the government recognises businesses struggling with their cashflow due to coronavirus remain worried about eviction.
“These measures, included in the emergency Coronavirus Bill currently going through parliament, will mean no business will be forced out of their premises if they miss a payment in the next three months.”
The statement said as commercial tenants will still be liable for the rent after this period, the government is also “actively monitoring the impact on commercial landlords’ cash flow and continues to be in dialogue with them”.
Communities secretary, Robert Jenrick, said 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 three months.
The Chancellor of the Exchequer Rishi Sunak said: “We are taking unprecedented action and doing so at unprecedented speed because we know that businesses and their employees need help now.”
Sunak said alongside the government’s support for workers and £330bn 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, said this measure will provide companies with an essential safeguard in these highly unusual times as they deal with the impact of coronavirus.
Mike Cherry, Federation of Small Businesses national chairman, said 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.”
In response to the government’s announcement, Melanie Leech, CEO of the British Property Federation, said the commercial property industry is committed to supporting its customers who, through no fault of their own but due to coronavirus, are concerned about how they going to pay their rent.
“The government has recognised that responsible property owners are already proactively offering flexibility around rent payments but the announcement of a three-month moratorium on the ability to exercise right of forfeiture in relation to non-payment of rent will offer additional reassurance to hard-pressed businesses.
“Property owners are similarly facing the impacts of coronavirus on their own businesses and will need further support – for example, to meet their obligations to their lenders and to the savers and pensioners who rely on the income they generate - if they are going to help as many businesses as possible come through the next few weeks.”
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