Extension to the moratorium on commercial lease forfeitures will last until 30 September 2020

Whether you are a landlord or commercial tenant, the latest Welsh Government announcement on the extension of the moratorium on commercial lease forfeitures will be interesting news. Hutchinson Thomas’ commercial property partner, Roger Morris, looks at what it means.

The Minister for Economy, Transport and North Wales, Ken Skates, has announced that the Welsh Government is extending its measures to protect businesses affected by COVID-19 from eviction for another three months – until the end of September.

Specifically, this means the measure introduced to assist commercial tenants who may be struggling with cash-flow during the pandemic, preventing landlords from forfeiting their commercial lease for late or unpaid rent – including service charge payments or other sums reserved as rent.

The measures were initially due to expire on June 30, but they have now been extended until the 30th of September. It is believed that this extension will help support the much-needed economic recovery across Wales. The aim is to prevent unreasonable evictions, thereby, helping to protect jobs and safeguard the longer-term stability of businesses which were operating successfully before the pandemic.

It’s no surprise that the timing of this extension comes just as non-essential retail businesses have begun to reopen. The measure will go some distance to ensure that no business will be forced out of its premises if it misses a payment over the next three months. This may be good news for the tenant but not so good for the landlord. So, it is vital that both parties understand the legalities and abide by them. It also remains important to note that when rent is due it should be paid on time whenever possible.

The Minister for Economy, Transport and North Wales, Ken Skates, said:

“This extension will be crucial in giving businesses the certainty they need to reopen and provide goods and services that their customers need. This will in turn reduce the risk of firms having to close and people becoming unemployed.

“We have put important measures in place to help protect the Welsh economy from the devastating impact of coronavirus by providing the most generous business support package in the UK. We continue to work hard to respond to the needs of business at this incredibly testing time and plot our pathway to a prosperous post-pandemic Wales.”

Deputy Minister for Housing and Local Government, Hannah Blythyn, said:

“It has never been more important to keep our towns and high streets vibrant. Ensuring Welsh businesses can open safely and without fear from eviction following this difficult time will be vital as we reopen our high streets and town centres.

“Giving our towns a sense of place is more important than ever, and as lockdown measures are eased, it is essential that we work collaboratively with partners to build sustainable town centres for the future where businesses can thrive. These extended measures will enhance the package of support for high streets and business; which includes supporting Business Improvements Districts with their running costs as our towns start to recover.

If you require help or advice regarding the moratorium on commercial lease forfeitures, or any other commercial property matter, contact our commercial property partner, Roger Morris, on 01639 640 150 or email roger.morris@hutchinsonthomas.com