Any news on the possible extension (or not) of the moratorium beyond September? And why not issue the service charge credits for Covid savings now?
With many tenants unable to pay, there’s a lot of unpaid rent, service charge and insurance building up. If it were to end then tenants will be faced with the prospect of their Landlord having options, ranging from issuing a statutory demand as the precursor to insolvency proceedings; Seizing assets through Commercial Rent Arrears Recovery (CRAR); Issuing court proceedings to recover rent or other sums due under the lease (known to be expensive and often protracted) OR concluding a reasonable re-structure of the terms of occupation by agreement as per the Government Code. This last option is clearly being pursued in many cases.
In the discussions, as service charge advisers, we have noticed that many Landlords are reluctant to adopt the service charge guidance set out by the RICS and the Government Code, being to issue any savings made at the earliest opportunity. The message is that we “won’t entertain any such refunds or credits” whilst the rent remains unpaid. I do wonder if the position might be improved by issuing those savings (where applicable) in the form of credits and doing the ‘right thing’ as a means to show they have adopted best practice in their approach to securing a resolution. So, whether there is an extension or not, it seems to me that those credits should be issued (where applicable)……no money would change hands, it would be offset against any unpaid rent and reduce the unpaid debt for the benefit of both Landlord and Tenant.
So, will it come to an end, be extended or will we have an alternative from of government intervention?
I understand a decision may be made this week.