Friday Five: the week's top news
- The hospitality sector could reopen from the third lockdown under national rather than regional restrictions, according to Boris Johnson. Despite the Government having recently announced the return of the tier system, which was introduced before the second national lockdown and which saw different parts of the country placed into different tiers, the Prime Minister said earlier this week that a blanket approach across the country was now more likely. “It may be that a national approach, going down the tiers in a national way, might be better this time round, given that the disease is behaving much more nationally,” he said. “If you look at the way the new variant has taken off across the country, it’s a pretty national phenomenon. The charts I see, we’re all sort of moving pretty much in the same sort of way, I mean there are a few discrepancies, a few differences, so it may be that we will go for a national approach but there may be an advantage still in some regional differentiation as well.”
- Burger brand Five Guys and café chain Caffe Concerto are both facing legal action over unpaid rent after one of their landlords filed respective county court claims against each operator. Court documents show Criterion Capital has filed a £1.5m claim to recover rent from Five Guys, and a £284,000 claim against Caffe Concerto. It has also filed a seven-figure claim to recover rent owed from a third hospitality firm, which asked not to be named. All three of Criterion Capital's legal claims have been made since June last year when the Government published its 'code of practise' for commercial rent negotiations. Caffe Concerto director Stephano Borjak said Criterion's behaviour amounted to 'harassment' while the moratorium is in place. He said: "We have paid our rent in full and on time for 12 years. But now we have only been allowed to open for three months since last year, our landlord issues a county court order against us. It is completely unacceptable."
- More than a third of hospitality businesses – an estimated 650,000 companies – fear collapse in the next three months, Labour has warned. As speculation continues to grow that restaurants and pubs could remain closed until May, new analysis released by the opposition party shows that the average hospitality or leisure business will receive £11,000 less in grant support during the third lockdown than it did during the first. Labour has accused the Government of 'economic negligence' if it fails to act, and has called on Business Secretary Alok Sharma to 'be the voice of business, not a mouthpiece for the Treasury' and back businesses in England by urgently outlining how he will support struggling hospitality and leisure businesses to survive the crisis. Analysis by the Labour Party based on the latest ONS survey data suggests that more than 650,000 accommodation and food services businesses have little confidence they will avoid collapse, and more than a million will run out of cash reserves in the next three months.
- A large number of insurers are continuing to 'sit on their hands' over business interruption claims, leaving many operators stuck in limbo as they try to secure payouts. Despite last month's landmark Supreme Court ruling, which found considerably in favour of policyholders in the Financial Conduct Authority's (FCA) business interruption insurance test case relating to losses suffered due to the Coronavirus pandemic, businesses have found themselves still struggling to engage with their insurers; although a minority have begun to receive interim payouts. "It's a mixed bag really," says Sonia Campbell, partner and head of the insurance disputes team at Mishcon de Reya, who has been working with the Hospitality Insurance Group Action (HIGA) to secure payouts for operators in the sector. "A limited number of insurers are actively engaging with policyholders and operating in the spirit of the Supreme Court judgement and FCA guidance. And we have seen some insurers make interim payments, and move forward with the adjustment processes. However, others are still not doing this, and we are seeing a real delay from some insurers who are just dragging their heels."
- US-founded fast casual chain The Halal Guys will not reopen its flagship London restaurant in Leicester Square. Jan van Delden, managing partner for ITICO F+B, which holds the master franchise for the brand in the UK, confirmed the closure to BigHospitality, saying the site had become unfeasible as a result of the severe decline in trade and footfall caused by the impact of the Coronavirus pandemic. “Central London has become a ghost town, and sadly we do not expect things to recover for a long time,” says Delden. “Prior to the pandemic our Leicester Square restaurant was doing major business, but that was reliant on a high footfall from central London office workers and both local and international tourism, all of which have deteriorated as a result of the pandemic.” The Halal Guys, which serves hot sandwiches or platters made with chicken, beef or falafel, opened its Leicester Square restaurant – the brand’s first European site – back in March 2019, with ITICO F+B originally hoping to expand the concept to 20 locations across the country in the next five years. It later opened a second London site in Earls Court, which has continued to operate a delivery service throughout the pandemic and will reopen for dine-in customers once lockdown restrictions are lifted.
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