Softly, softly plea to landlords on Quarter Day
LANDLORDS across the North West are being warned struggling retailers may be forced into closure because of a quarterly demand for advanced rent on their stores.
Solicitor and commercial property specialist at Kirwans, Lisa Evans, said pressure for rent on “Quarter Day” applies from corner shops to large chains and was linked to the demise of some of the UK’s big high street brands, including La Senza, Blockbuster and Phones4U.
“Conditions are still tough for retailers and the Quarter Day means they trade through one of the most financially stressful weeks of the year,” said Evans.
“Cash is king and some retailers can find themselves in a perfect storm, unable to pay advance rent, meet payroll at the end of the month and maybe even face a VAT bill too.
“There’s a lot of goodwill and sympathy towards the high street but the landlords need consideration too.
“Property is an expensive asset and landlords have their own obligations to meet. Finding yourself with a tenant who can’t pay is a significant issue.”
She said that landlords can look at a number of options before the ultimate sanctions of evicting tenants.
“It is better to have a tenant in place, rather than overseeing a vacant property,” she said. “As in so many situations in business, negotiation is key.
“Having a straightforward conversation with your tenant about what they can afford and how you can work through the situation, is an important first stage in coming to a solid agreement. There are a number of legal options and next steps that landlords can follow depending on how the negotiations go.”
Key steps that landlords can take include negotiating with their tenant a temporary change to the lease. This could see the tenant paying a smaller amount over a shorter period for a specified time – such as monthly, or weekly payments – until they are able to return to the original lease conditions.
