Some of Britain's top retail heavyweights have joined forces in a renewed revolt calling on landlords to dump their 'ancient practice' of quarterly rent payments in favour of charging a more manageable month's rent in advance.
As well as urging landlords to alter the terms of new and renewed leases, the campaign - spearheaded by Arcadia Group and Bhs owner Sir Philip Green and Carpetright chairman and chief executive Lord Harris - is putting pressure on landlords to be more flexible on the terms of their existing leases. If successful it would mean landlords rewriting leases in the middle of lease terms.
The move has come during the current credit crunch which is putting financial pressures on retailers, but it is an issue that the British Retail Consortium has been tapping away at for two years. BRC spokesman Richard Dodd says that the current financial pressure facing retailers is not the main reason for their call to action. "It would be wrong to say this is a response to the difficult conditions now or that it was primarily about that because we were doing this two years ago when the economy was stronger," he said. "It was about the principle of demanding quarterly rents in advance being an historic practice, going back to the horse and cart."
The British Property Federation, which represents the UK property industry, has said its members will endeavour to work with their tenants to find solutions to any financial problems they may face as a result of rental payments and that includes considering monthly payment terms as part of new lease negotiations.
Liz Peace, chief executive of the BPF, said: "It goes without saying that landlords want to help any tenant genuinely in trouble. It is not in a landlord's interests to see a tenant go under, so where tenants are in trouble, they should speak to their landlord."
The BPF's Commercial Landlord Accreditation Scheme (CLAS) offers tenants the security of knowing their landlord abides by the highest standards of service.
Peter Best, PRUPIM's head of asset management, added: "As an accredited member of CLAS, PruPIM follows the lease code and leads by example by offering flexible terms to our customers. We are willing to consider monthly rent terms as part of the overall package we offer and recognize that such arrangements may be helpful to struggling businesses."
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