Government confirms extension of commercial rent protections

The lease forfeiture moratorium, which was introduced in March and prevents landlords from repossessing commercial premises if businesses are unable to pay their rent as a result of the Coronavirus pandemic, had been due to expire at the end of month.

As a result many businesses across the hospitality sector faced evictions and other enforcement activity.

However, earlier today (16 September) Communities Secretary Robert Jenrick confirmed the protection will now run until the end of 2020.

"Today we are extending support to protect those businesses that are unable to pay their rent from eviction to the end of the year," he said.

"This will stop businesses going under and protect jobs over the coming months.

"This Government is committed to supporting businesses and our high streets at this difficult time, and this extension of support will help businesses recover from the impacts of the pandemic and plan for the future."

A restriction on landlords using Commercial Rents Arrears Recovery to enforce unpaid rent on commercial leases has also been extended until the end of the year.

However, a further ban on the issuing of statutory demands and winding up petitions, originally introduced back in June, has not been included.

Commenting on the announcement trade body UKHospitality, which warned the Government earlier this week that a failure to take action over rents would trigger a 'bloodbath' of businesses failures across the sector​, said the extension to the eviction moratorium must be followed by further support.

“This is a welcome step forward and should give businesses some much-needed breathing room to come to agreements," said UKHospitality chief executive Kate Nicholls.

"This alone, however, is not going to solve the crisis.

“It’s critical that the Government also extends the moratorium on statutory demands and winding-up petitions and include County Court Judgments.

"This should be extended until the end of March 2021 to give maximum opportunity to find solutions. 

“It needs to be followed by further support which, crucially, must include working with landlords and tenants to find a mutually equitable solution. The debt is not going to go away and many businesses have no chance of paying. This is a stay of execution, but we are still short of a full reprieve.”

With the extension now in place, the Government has said both landlords and tenants should continue to work together to agree rent payment options if businesses are struggling, encouraging them to follow the Code of Practise published back in June​​ to help support these discussions.