In the wake of the COVID-19 pandemic, the government has announced additional support for commercial tenants in relation to rent arrears. 

How this might affect you?

On 16 June 2021, the government announced that the limitations on the forfeiture of commercial leases for non-payment of rent will continue in England until 25 March 2022.

Legislation is to be introduced to ringfence rent arrears where they have arisen due to businesses needing to stay closed during the pandemic.

Whilst this legislation is yet to be seen, the government has suggested that landlords and tenants will be required to come to an agreement in relation to the rent arrears. Where an agreement cannot be reached, a binding arbitration process will be put in place to create a legally binding agreement that both the landlord and tenant must abide by.

Until these new rules come into force, the current measures to protect commercial tenants will remain in place. The government has stressed, however, that those businesses who are able to pay rent, must continue to do so.

“We have yet to see the legislation, so I expect the devil will be in the detail. The wording of the press release suggests that some of these measures might be limited to those businesses that had to close during the pandemic.” Richard Jobes, partner and head of property litigation

We will provide a more detailed summary of the new measures once the new legislation is available. In the meantime, we can support you with all aspects of landlord and tenant law.

If you need some guidance in relation to your commercial properties, we’re here for you – get in touch.