In the second advice piece curated by BigHospitality as part of their #UnitedWeStand campaign, proudly supported by Unilever Food Solutions, property expert Ted Schama provides guidance on dealing with landlords and what the Coronavirus means for the restaurant property market.
What advice would you give operators who can’t pay their rent – what should they be asking for?
- Communication is number one, closely followed by transparency.
- Ask for a 3-month holiday on rent payments.
- Work with your landlord to identify other options if this isn’t possible.
How receptive are landlords being to these sorts of requests? What can operators do to make them more receptive?
- Most landlords that are able to handle these sorts of requests are extremely receptive.
- For independent and smaller landlords this can be more difficult.
- In all cases, politeness goes a long way.
What if you really can’t pay?
- Make it clear that you intend to pay as soon as you can – showing positive intention is key if you were to end up in court.
What government aid is there for people struggling to pay rent? Should restaurants be using the government loans for this purpose?
- Only use loans as a last resort.
- Once restaurants start to reopen again landlords will start weighing up their options. If you are already highly leveraged, then the property risk will come in when we normalise again.
What do you think will be the medium term effect of the Coronavirus pandemic on the UK property market?
- There will be a rout of weaker tenants.
- If you were already exposed and highly leveraged ahead of the crisis it’s going to be tough.
- The positive is that we’ll see a continuation of a drop in premiums and rents, leading to more good opportunities for fitted sites for emerging operators.
- Medium term effect will be fairly positive. In previous conventional recessions, restaurants are the last to suffer and the first to rebound.
Click here to see the full article on BigHospitality and discover more about #UnitedWeStand.