Global real estate fund manager Prupim introduced monthly rents as a temporary step in March 2009 in response to the economic conditions faced by the retail sector. Following consultation with occupiers, the policy has been extended for a further year to March 2011.

Director of retail asset management, John Duxbury, said: “This move is good news for retailers and for our investors. Retailers are better able to manage cash flow during a tepid economic recovery and invest for their future, which aligns with our strategy of preserving a term, sustainable returns for the funds we manage.”

PRUPIM had estimated that up to 1,500 eligible tenancies might take up the scheme last year whereas in fact applications reached around 750.

“In just about the toughest year imaginable for UK retailers, fewer businesses than we expected took up the offer,” said Duxbury. “This suggests that many retailers recognise that a monthly rents policy is not the magic bullet that some portray it to be. In fact, many told us they turned down the offer simply because it generated too much extra administration and costs for them."

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