The Government, tenants and Landlords should make a tri-partite agreement to get British business back on its feet

Government should support landlords and tenants in the hospitality and retail sectors by bearing a third of the cost of rents while businesses open up, say leading tax and advisory firm Blick Rothenberg.

Mark Hart, a retail partner at the firm said: “ The Secretary of State for Business Kwasi Kwarteng has recognized that businesses are struggling with cashflow as they reopen with leisure and hospitality still not being able to operate at full capacity, but he has not come up with a plan and businesses are struggling now.”

He added: “ A clear means of offering targeted support for retail and the hospitality sectors would be for Government to provide grants for up to a third of the rent cost with a third being met by the tenant and a third being negotiated with the landlord. This arrangement should be coupled with a commitment for the landlord and tenant to agree a new basis for the future rentals going forward.”

Mark said: “With the moratorium on rents ending on 30 June 2021 this is an issue that needs addressing immediately. Delaying addressing the arrears by another six months risks retailers and other tenants kicking the can further down the road.”

He added: “It is clear that the market is seeing the basis of rents changing to take account of affordability. By taking action now, the Government could help create a sustainable business model which takes into account the current reality, preserves jobs and works towards ensuring bricks and mortar retail remains a viable business model.”

Mark said: “Retailers need to consider the position of the landlords, and how they can help them. Offering an extension of a lease in exchange for writing off some arrears, considering a turnover based rent or a mixture of a floor and capped rents should all be elements of a negotiation aimed at ensuring both landlords and tenants benefit from the arrangements and a stable financial position going forward.”