Great news to see that REVO, the BPF and others are working with the government to produce a code of practice to try to encourage "fair and transparent" discussions between owners and occupiers of retail premises, as well as guidance on rent arrears payments. The groups are calling for collaboration and co-operation at all levels (owners, occupiers, funders) with the aim that no one part of the chain shoulders the full burden of the cost of the pandemic on the retail sector.
Our experience has shown that many of our clients are already having these frank and open discussions and that deals such as rent concessions in return for reversionary leases or removals of breaks are becoming increasingly common. As we approach the June quarter, with many retail occupiers having been unable to trade, or trading at significantly lower levels since the March quarter, we expect to see more of this type of deal.
Open communication is clearly the way forward, and guidance as to best practice across the industry will no doubt be much appreciated by all.
A working group has been established by the government with the commercial rental sector to develop a code which encourages fair and transparent discussions between landlords and tenants over rental payments during the coronavirus pandemic and guidance on rent arrear payments and treatment of sub-letter and suppliers. This will enable collaboration and cooperation within the sector and help ensure no one part of the chain shoulders the full burden of payment.