Update on commercial tenancies during the Pandemic

Unsurprisingly, the restrictions on forfeiture of business tenancies for non-payment of rent are to continue in England until 30 June 2021 - but what is likely to happen after that?

Central government are likely to want to avoid an abrupt cliff-edge resumption of normality and are consulting as to what should then happen.  Current options would appear to range from a phased withdrawal of current protections to possibly legislating to protect businesses worst-hit by the pandemic.

It has also been announced that legislation will be introduced to increase the minimum net unpaid rent that must be outstanding before commercial rent arrears recovery (CRAR) can be deployed in England and Wales, which is expected to be 457 days between 25 March and 23 June 2021, and 554 days between 24 June and 30 June 2021.

Government’s ambitions do not end there, and they have indicated a wish to start to review later this year the statutory security of tenure provisions in Part 2 of the Landlord and Tenant Act 1954.  The 1954 Act is famously not an especially well-crafted piece of legislation and has been added to over the past 70 or so years and so we shall eagerly await what this entails!

If you have concerns regarding a commercial lease, you can draw on the expertise of our specialist litigation & dispute resolution department to ensure this is appropriately managed in a commercial and commercial way.

You can follow the links below to read previous, related articles about commercial rent arrears recovery:

What is the latest on business tenancies as we emerge from the Coronavirus lockdown? (July 2020)

Options for a commercial landlord if a tenant was in default before lockdown (May 2020)