On 19 June 2020 the government introduced a Code of Practice to support commercial landlords and tenants through Coronavirus. Its aim was to help high streets and town centres be “in the best possible position to come back from these challenges” and reduce the number of businesses being forced into administration.
The code will apply until 24 June 2021. At present it is voluntary because each tenancy will be different but the government has not ruled out making it mandatory if it is not widely complied with.
In particular the code is intended to encourage:
- transparency and good faith
- tenants to pay as much rent as they can and, if they are struggling, to provide financial information to their landlords to support any request for rent concessions
- landlords to grant rent concessions if they can, giving reasonable explanations for any refusal
- tenants to prioritise reimbursing landlords for insurance and service charge in preference to rent
- landlords to reduce service charge payments (if services have been reduced), without waiting for the annual service charge reconciliation
- landlords and tenants to collaborate to address any other challenges they are facing because of Coronavirus, to create a shared recovery plan
Please contact Juliet Rayner if you would like further information.