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Hospitality businesses need extra protection after landlord retaliation

UKHospitality has written to the Government to ask for urgent support to protect businesses from punitive legal sanctions from commercial landlords.

The trade body has called for an immediate extension of the forfeiture moratorium for 6 months and a widening of the scope to include broader debt enforcement measures, including winding-up orders, statutory demands and commercial rent arrears recovery (CRAR).

UKH has also urged the Government to ask landlords to use time to renegotiate terms with tenants.

The letter to the Ministry of Housing, Communities and Local Government highlights threats directed at hospitality businesses by landlords at a time of unprecedented pressure and crisis. These include winding-up orders and bailiff action.

UKHospitality Chief Executive Kate Nicholls said: “We urgently need action from the Government to provide legal protection for businesses. The moratorium on evictions of commercial tenants announced last week does not go far enough, we need a full rental debt enforcement moratorium.

“Rather than use this as an opportunity to work with businesses to investigate rent deferrals or waivers, many landlords have instigated, or threatened to instigate, actions that will cripple businesses and lead to a further loss of jobs on a significant scale. We have had reports of excessive interest payments applied to rent deferrals, as well as winding-up orders and bailiff action being threatened – at a minimum imposing extra cost to business and at worst threatening their ongoing viability. We have also been alerted to instances where funds have been withdrawn from deposits with top-ups demanded in order to avoid lease terms being broken.

“This is an unprecedented medical, social and economic crisis for the country, with citizens pulling together. Millions of people’s livelihoods and job security depend on businesses working in harmony. Business as usual cannot apply at this stage. Yet, landlords are effectively signing a death sentence for many businesses that are just about keeping afloat.

“We need legal protection to buy time for under-pressure businesses. Otherwise, they will fold, and even more jobs lost.”