Simon Waterfield, partner and specialist property dispute solicitor at Nelsons, explains how commercial property landlords can tackle the issue of tenants who haven’t paid rent. “During the pandemic, the government recognised that a lot of organisations were struggling to pay their rent due to enforced closures. In addition to providing them with furlough support, the government put the moratorium in place, which meant that a landlord wouldn’t be entitled to forfeit the lease or collect rent arrears during the designated time period. Due to come to an end on 25 March 2022, landlords will then be able to go back to pre-Covid ways of managing their commercial properties.
“The government did not reveal a structure on how the process post-25 March will work. However, the court has said that any dispute or rent arrears will need to be resolved between the landlord and the tenant, and has issued a code of practice to assist with this process. If an agreement can’t be reached, then a binding arbitration process will need to be entered. This involves both parties making their submissions to an arbitrator, who then makes a decision that is binding for both parties.”
Waterfield concluded: “It is still uncertain exactly what will unfold when the emergency moratorium comes to an end. However, it’s highly likely that the fallout will continue for many months following its conclusion.”