Retailers face ‘tsunami of closures’ over unpaid rents –

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Retailers face ‘tsunami of closures’ over unpaid rents – fr


Shopping streets are threatened by a “tsunami” of store closures, with landlords free to claim billions of pounds in unpaid rent in court, retailers have warned.

Business owners were barred from taking legal action to claim rent or evict tenants under a moratorium agreed upon at the start of the pandemic while stores were closed.

But the British Retail Consortium is warning that two-thirds of businesses are bracing for legal demands from landlords to collect some £ 2.9bn in rent arrears when the ban ends on June 30.

Helen Dickinson, CEO of BRC, said: “Many retailers have been hit hard by the pandemic, but they are now getting back on their feet and playing their part in revitalizing the economy. The unpaid rents accumulated during the pandemic, when most stores were closed, are a £ 2.9 billion ball and chain that is holding back growth and investment and could lead to a tsunami of closures. “

About one in seven stores or 14% of UK stores are already empty after around 5,000 stores closed during the pandemic, according to figures from the organization.

Its survey of retailers representing 5,000 stores and £ 12 billion in sales found that two-thirds were told they would face legal action from July. Some 30 percent of businesses have already received county court judgments, and 80 percent of tenants said some landlords gave them less than a year to pay off arrears.

The BRC called on the government to close the pandemic unpaid rents and extend the moratorium until the end of the year, as well as to introduce binding arbitration between tenants and landlords to replace the current voluntary system. He is also pushing for an end to the use of county court judgments to circumvent the legal ban.

The call angered the real estate industry, however, as landlords accused some retailers of using the pandemic to avoid paying rents or forcing rents down through restructuring.

Melanie Leech, Managing Director of the British Property Federation, said: “There are still well-capitalized retail businesses exploiting the moratoria, refusing to engage with landlords or pay rent. ”

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