New restrictions on commercial rent arrears only apply to "COVID" arrears

Yesterday, the Business Secretary, Alok Sharmar, announced that temporary measures would be taken in England to restrict the use by commercial landlords of Insolvency measures and aggressive rent recovery actions taken by landlords against their tenants.  The measures are temporary in nature and will end on 30^th June 2020, all be it that they can be extended for a further period thereafter.

I am sure we can all agree that measures like that are sensible in the current climate.  Nobody wants to see good businesses coming to harm in this current climate. It is important to note, however, that these restrictions only apply to situations where rent arrears have accumulated due to the current Covid restrictions.  Action can still be taken with regards to rent arears that pre-date the current problems.

I act for a number of commercial landlords. I have to say that their attitude to date has been commendable.  None have sought to commence recovery proceedings against tenants who are suffering hardship at this time.  However, I have also come across a number of tenants who are attempting to use the current problems as an excuse to avoid paying historic rent arrears.  By historic I mean those that pre-date the current problems that we all face. The new restrictions announced yesterday will not protect those tenants.  Leases can be brought to an end, and recovery action commenced, against those tenants.

If you require any assistance with regards to recovery of commercial rent arrears, please do not hesitate to contact our specialist team at Gilson Gray.  We have over 20 years’ experience in acting for commercial landlords and assisting them with such matters.