Rent moratorium continues: bad news for Landlords good news for Tenants

The rent moratorium continues – bad news for Landlords, good news for Tenants

Jun 17, 2021

The Government have announced the rent moratorium on landlords taking forfeiture action against its commercial tenants has been extended until 25 March 2022.

Why was the rent moratorium introduced?

The rent moratorium was initially announced on 26 March 2020 in an effort to support those businesses who had no choice but to close their stores during the pandemic and to suspend a commercial landlord’s ability to evict their tenant if they failed to comply with the terms of their lease for example, not paying rent.

What if rent negotiations are unsuccessful?

As the Government prepare for “Freedom Day” on 19 July 2021, they also intend to introduce a backstop on commercial rent moratorium negotiations between landlords and tenants. This will mean that if such negotiations were unsuccessful, the parties will go into binding arbitration and therefore offer peace of mind to both parties that their debts will be settled fairly and finally.

In the meantime, the Government continues to encourage tenants to start paying rent again in accordance with the terms of their lease and for commercial landlords and tenants to continue working together to agree a route forward.

We are seeing that many of our landlord and tenant clients have agreed rent payment compromises to support each other through this time and would simply remind all parties of the importance of documenting any such agreement. See our previous article ‘COVID-19: Commercial lease – documenting a rent concession‘ for more information.

If you require further guidance regarding the effect of the Coronavirus on commercial lease terms or advice on commercial leases in general, please contact Daniel York, Partner, in our Real Estate department. Alternatively, you can email your query to; call us on 01276 686222 or fill in a contact form.

This reflects the law at the date of publication and is written as a general guide. It does not contain definitive legal advice, which should be sought as appropriate in relation to a particular matter.

COVID-19: Commercial lease – documenting a rent concession

Coronavirus (COVID-19) and the restrictions now in place to control its spread, are having a significant effect on many business sectors.

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Daniel York

Daniel York

Partner, Property Law

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