Commercial property landlords facing unpaid rents and vacant buildings have been forgotten by the government, says tax and advisory firm Blick Rothenberg.
Blick Rothenberg’s remit survey, conducted across all property classes, showed that of rents collected in June an average of 38% rent remained unpaid 10 days after the due date. This number climbed to 47% of rents unpaid within offices.
According to Heather Powell, property partner at Blick Rothenberg, the government’s code of practice for commercial property is advisory, and unenforceable by landlords.
She said: “A tide of winding up petitions to force payment of rent – or even for the winding up of landlords who have run out of cash – is not going to help the UK economy get back on its feet.”
Powell explained that landlords are not being paid their rent, despite the government’s remarks stating that if tenants can pay, they should. She believes that the chancellor has “done nothing” to help landlords get their rent, and that commercial property owners were ignored in the chancellor’s summer statement.
She added: “Tenants need to be reminded, strongly, that rent unpaid in March and June, and rent due in September is still payable, and that where they can make payment that they should be doing so.
“To incentivise tenants in this position, landlords need to be given a fast track process to enforce payment by these tenants of all outstanding rent and services charges from the end of the rent moratorium in October – with interest and any other financial penalties included in the lease for non-payment of rent.”
Powell explained that if enacted, landlords will then be able to focus on working collaboratively with tenants, including many in the retail sector, whose businesses are in real distress to produce solutions that work for each party in the long term.
Powell said: “Owners of commercial properties are being treated as a bottomless money pit by the government, required to significantly improve the carbon efficiency of their buildings, to contribute to the regeneration of our high streets, and to support businesses who signed leases that they can honour – but choose not to.”