Pension funds, insurers, institutions and other investors in the property sector experienced a shortfall of £5.3bn in rent collected on commercial properties over the first 12 months of the pandemic, according to the latest research published by Remit Consulting.
Based on verified financial reports from national firms of property managers responsible for 125,000 leases on over 31,000 prime commercial property investment properties across the country, Remit Consulting analysed rent and service charge payments for the three months between Christmas and the March Quarter day.
Laura Andrews at Remit Consulting, said: “The initial analysis of the data on rent collection for the March Quarter Day indicates that property managers are seeing further falls in the levels of rent paid across the board. Overall, less than half of the rent payments due on March Quarter Day were received by property managers and reveal the poorest start to a financial quarter since June last year, which were the lowest collection rates of the pandemic so far.”
Remit Consulting also reported the growing expectation within the property sector that, when the moratorium is lifted, the market might see an increase in the use of Company Voluntary Arrangements (CVAs) as an escape route for businesses struggling to pay their rent.