Pubs and restaurants struggle to pay rent due to lockdown restrictions
Commercial landlords collected just 77 per cent of rent in the final quarter, as retail, leisure and hospitality firms struggled under the pressure of lockdown restrictions.
The latest research showed that pub, bar and restaurant tenants paid 23 per cent of rent as sales were decimated by Covid-19 restrictions in the crucial Christmas trading period.
Following the dip in rent collections, the head of UK asset services at Cushman & Wakefield Nick Ridley called for more support for landlords who have been “equally” impacted by the pandemic.
The extension on eviction bans until March 31 will have a significant negative impact on rent levels, Ridley warned.
“The current unprecedented conditions are likely to see more tenant stress in certain sectors, and therefore landlords, suffer too,” Ridley said.
“Now is the time for the government to implement a plan to support landlords, which we recommend includes rent subsidies through property bounce back grants, the protection of tax-free shopping and a radical reform of the business rates system.”
Rent collections dropped by only one percentage point compared to September’s figure of 78 per cent, the Cushman & Wakefield data showed.
But poor Christmas trading due to restrictions left many pub, restaurant and leisure businesses unable to meet rent commitments in the final quarter.
Meanwhile, shopping centre landlords received less than half of rents, with only 49 per cent paid.
The office and industrial sectors had the strongest quarter, with 88 per cent of rent collected.