James Morrison

Tomorrow, Friday 1 May, marks the first significant rent payment day since the start of the COVID-19 lockdown for shopkeepers across Northern Ireland’s high streets.

James Morrison, commercial partner at DWF in Belfast, said: “Until the end of June at least, landlords face a period where the rent they are owed is still due and should be demanded.

“Under current legislation however, the usual actions they would take against tenants for non-payment have been taken away from them – and this includes forfeiting lease arrangements should rent be unpaid.”

He added: “Understandably landlords are now expressing frustration. If tenants are not paying rent or service charges, a landlord could face considerable cashflow issues which in turn could impact on the re-opening of retail schemes once the current lockdown is lifted.”

The UK government has not responded to proposals from landlord groups for rescue measures, such as government subsidies for tenants’ rent in proportion to their forecasted loss of turnover.

“None of the government measures currently in place cancel the rent which has fallen due. It is only the consequences of non-payment which have been suppressed,” said Mr Morrison.

“Tenants who wish to or are able to manage their cash flow may elect to continue paying rent. Those who do not could find that once this lockdown on landlord enforcement is lifted, they may suddenly face statutory demands, winding up and bankruptcy petitions, some of which may be for sizeable arrears amounts.

“It is at this stage that tenants will look to the proposed new insolvency legislation to clarify what protections they have against further landlord action. This legislation (which is expected imminently and will be reviewed keenly) will go some way to dictating the future shape and layout of the high street, but one thing is certain, it is destined to be a very different retail landscape.”