Even commercial landlords are struggling from the effects of COVID-19.
Intu, the group owning a number of large shopping centres, including the Trafford Centre in Manchester, entered into administration at the end of June.
Intu’s financial difficulties were documented long before COVID-19 (with £4.5m of debt last year) , but it is apparent that the pandemic has been the final nail in the coffin as tenants fail to make rental payments.
As the government continues to legislate to protect tenants from the financial effects of COVID-19 (including the suspension of winding up petitions, prevention of forfeiture for non-payment of rent and changes to Corporate Rent Arrears Recovery), it has perhaps been taken for granted that commercial landlords will have to (temporarily at least) go without any ability to enforce payment of rent from their tenants.
If the landlords themselves can’t survive a suspension of payment of rent by tenants, then the impact of COVID-19 on the High Street could be far bigger than anyone could have imagined. Indeed, Intu directly employs 3000 people and over 100,000 are employed in its 17 shopping centres.
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