Lease forfeiture moratorium to be extended until 2022

By James McAllister

- Last updated on GMT

Lease forfeiture moratorium to be extended until 2022

Related tags Rent arrears Rent Lease Government

The ban on commercial evictions introduced during the pandemic is set to be extended until 2022.

The lease forfeiture moratorium, which prevents the repossession of commercial premises if businesses are unable to pay their rent as a result of the Coronavirus pandemic, had been set to expire at the end of the month, but The Telegraph​ ​reports that ministers are expected to announce today (16 June) that the grace period will continue for at least another six months.

Restrictions on landlords being able to recover rent arrears by taking control of a tenant’s goods and selling them are also expected to be extended, while a new arbitration mechanism is expected to be introduced to help resolve disputes between landlords and tenants on debt.

It is estimated that close to £3bn in unsettled rent has accumulated within the hospitality sector since the start of the pandemic.

News of the extension follows a Government call for evidence​, launched in April, about the best way to withdraw or replace these protections in place for businesses, in order to support the millions of jobs that they underscore.

At the time, the Ministry of Housing, Communities and Local Government warned: “If there is evidence that productive discussions between landlords and tenants are not taking place, and that this represents a substantial and ongoing threat to jobs and livelihoods, the Government will not hesitate to intervene further.”

Data published by Cedar Dean back in January highlighted the scale of the rent crisis facing the sector​.

The report, which surveyed more than 400 leading hospitality and retail businesses, representing over 10,000 locations across the UK, found that 77% of hospitality operators were being forced to look at restructuring or insolvency options, with current rents remaining unaffordable for the vast majority of businesses.

Only 31% of businesses had successfully agreed new terms with the majority of their landlords, with 73% saying they wouldn't be able to survive the next six months without further support from the Government or their landlord.

Perhaps most starkly, just 1% of those surveyed said they were ‘very confident’ that Government support will be forthcoming; in contrast, 85% say they were ‘not at all confident’.

Amid reports of the moratorium extension, the Prime Minister’s official spokesman told The Telegraph​: “We're considering responses to a recent call for evidence on the next steps with commercial rent and we'll set our response shortly.”

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