Hospitality industry calls for lease forfeiture moratorium to protect businesses
The call comes in advance of 25 March, the date that thousands of hospitality businesses will have to pay their quarterly rent bill.
With many restaurants now closed across the country as a result of the Government’s advice earlier this week to stay away from pubs and restaurants, and amid the growing spread of the Coronavirus, many will be unable to make their rent payments next week.
While some businesses will have already requested a payment holiday or delay, others are still being expected to pay.
While BigHospitality understands that some landlords have contacted their tenants to offer rent postponements or changes to their rental programmes in the short term, others are refusing to budge and that some are even charging a fee or asking for increased deposits to allow them to change to monthly payments.
“Tens of thousands of cash-strapped hospitality operators won’t have the time or leverage to negotiate individual payment plans with uncooperative landlords,” says London Union’s Jonathan Downey, who is leading the call for Government intervention and which is supported by others in the sector.
“Government can do something quick and effective and cut through all this.”
Downey says that a moratorium wouldn’t cost the Government anything but added that the financial position of landlords would also need to be protected. For this, he is also calling on the Government to create a six-month debt enforcement moratorium to give landlords breathing space against litigation, foreclosure and other enforcement of security.
Earlier this week the Government announced a £330bn loan support package to help businesses hit by Coronavirus, offering up funds for businesses to use to pay rent and staffing costs, but many in the industry say this does not go far enough and that they will be faced with crippling debt as a result.
