When will the Commercial Evictions Start again?
There has been no rent holiday during the pandemic, but landlords have been barred from evicting tenants from commercial premises.
This restriction will now remain in place until March 2022.
In addition, the existing debts of unpaid rent accumulated during the pandemic will be ring-fenced, in order to protect struggling tenants. These rent arrears will then go through a new arbitration process to help landlords and tenants resolve disputes over bad debts. Landlords are also unable to issue a winding-up petition to collect unpaid debts.
This gives significant protection for the businesses although brings significant pain to the Landlord, the issue would be if the Banks then see this as a break of the covenant in any loan terms and may request the Landlord to reduce their Loan to Value requiring re-financing. This has history back in 2010 where banks profited from forcing landlords to sell or refinance their loans at significant costs in fees and interest.