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Moratorium on Commercial Rents Extended

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The eviction ban on businesses from their premises for rent arrears has been extended and this will obviously have implications for commercial landlords.

The eviction ban was due to be lifted on 30th June 2021 and landlords could have then pursued non-paying tenants for commercial rents not paid, now that date is to be extended to 25 March 2022 leaving landlords with an additional 10 months until they can take action.

The ban was first introduced in March 2020, so for some landlords it may be 2 years until any action can be taken to evict tenants from the commercial property.

Initially the moratorium was hoped to have helped mainly the hospitality and retail sectors who have suffered from closure and limited trading during the crisis.  It was expected that businesses could have traded their way out of debt and begin to repay any rent arrears, but with restrictions in place longer than anticipated that has now not been the case.

How can Pearson Solicitors help landlords with rent arrears?

Landlords cannot forfeit a commercial lease for non-payment of rent, and we would advise all struggling landlords to consider the following options:

  • Utilise the UK Government’s binding arbitration scheme to resolve disputes between landlords and commercial tenants. Such a scheme will be in place until the eviction ban is lifted in March 2022.
  • Consider debt recovery proceedings against the tenants and any personal guarantors.
  • Wait until 1 October 2021 to issue statutory demands, a formal request for payment or winding-up petitions if the business owes them money. The ban on statutory demands or winding-up petitions for seeking rent arrears may be extended.

Tenants have been advised to pay what they can and pay rent in full and landlords should be supportive.

Commercial Property Litigation Solicitor, Usman Anwar said: “The extension of the ban on evicting commercial tenants for rent arrears to March 2022 will be disappointing for many landlords. Existing debts and rent arrears will continue to accumulate and commercial property owners are obviously adversely affected by this.

We offer a free initial meeting to commercial landlords to provide guidance with the aim of identifying other tenant breaches which may not be clear and to provide clear and cost effective solutions.”

Commercial landlords are now suffering a huge backlog in rent arrears and are being crippled due to the lack of rental income. As the latest quarterly rent day comes and goes commercial landlords are again expecting a shortfall which is putting a strain on their businesses and families.

Pearson Solicitors in Manchester and Oldham have a commercial debt recovery team ready to assist any landlord or tenant facing difficulty and offer a variety of fixed fee payment packages.

Our commercial debt recovery team can help you recover money owed to you speedily and cost-efficiently – enabling you to improve cash flow, reduce debt levels and free up valuable time to concentrate on your business – just get on touch with us and we can help with your commercial debt issues enquiries@pearsonlegal.co.uk

Contact our Commercial Litigation Solicitors

If you are unsure about your options or need further help and advice on Landlord and Tenant Disputes, please contact our Commercial Litigation Solicitors on 0161 785 3500 or email enquiries@pearsonlegal.co.uk

Please note that the information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by Pearson Solicitors and Financial Advisers Ltd or any of its members or employees. Professional legal advice should be obtained before taking, or refraining from taking, any action as a result of this article.

Written by Usman Anwar

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