We all knew it was coming, but that did not make the government’s announcement on Monday that so-called Freedom Day would be delayed until 19 July any easier to stomach, not least because of the likely ramifications.
By Tuesday, we were hearing mutterings of an imminent government announcement on how it planned to tackle the £6bn in rent arears . Come Wednesday, the can had been kicked down the road yet again and the commercial evictions moratorium extended, but not until 19 July, a decision that would have had some logic to it, or even by a few months, which would have had less logic but been potentially manageable for landlords.
No, it was extended until 25 March 2022, a truly perverse decision that could be the final nail in the coffin for some landlords (you only need to look at the miserable results posted in recent weeks to see who).
So how has it come to this? How could the government possibly think that the fairest way forward both for landlords and tenants was to extend the moratorium by nine months? As CWM’s Jonathan De Mello says: “It’s crazy… this absolutely screws landlords over.”
It could also send some under. With arbitration cases likely to favour the tenants, landlords can pretty much take it as read that they will not be able to recoup all they are owed. How utterly ridiculous when some retailers have traded throughout the pandemic yet still brazenly refused to pay rent?
But there is no point having a pop at the likes of UKHospitality boss Kate Nicholls or the BRC. Many in the retail and hospitality sectors are still fighting for their lives and Kate and co have just done their jobs, rather well as it turns out. Not so, sadly, the property industry and bodies that represent it.
While it is extraordinary that the government continues to favour occupiers – however badly behaved – over landlords, the industry has done itself no favours with its lobbying efforts.
Disjointed, limp-wristed and overly complex, its messaging has simply not been compelling enough, even when good ideas have been tabled, such as Boxpark boss Roger Wade’s proposed solution based on the Denmark model (whereby landlords can give tenants up to 50% rent free for 12 months and claim back rent from future tax reductions or grants).
To be fair, the industry’s task is harder. The government wants to be seen as protecting jobs – and there are lots of jobs in the retail and hospitality sectors it wants to be seen as protecting. Moreover, everyone has witnessed first hand how badly retailers, pubs and restaurants have been affected by the pandemic.
By contrast, few outside the industry will have given any thought to the owners of the buildings accommodating them and fewer still will care. To most, commercial landlords are faceless corporate entities sitting on obscene piles of cash.
The industry must challenge such perceptions and spell out the moratorium’s devastating impact on landlords, but it should not just focus on how much money they have lost. Most people don’t care. It should focus on the impact on people’s pensions. That is the message that will hit home – that and the fact that the survival of retail and hospitality tenants will be somewhat academic if their landlords go under and there are no units for them to occupy.