Coronavirus COVID-19 and commercial leases

Commercial landlords are to be stopped from forfeiting commercial leases and evicting their tenants for non-payment of rent under proposals contained in the draft Coronavirus Bill. The measures will be in place until at least 30 June 2020 and will be reviewed thereafter.

The Coronavirus Bill is currently progressing through the Parliamentary process, but is expected to be passed shortly.

The relevant part of the Bill is Section 82. If/when passed the Bill will apply to a ‘relevant business tenancy’, this being a lease where the part 2 of the Landlord and Tenant Act 1954 would normally apply.  The Bill will preclude a landlord from exercising the right of re-entry or forfeiture for the non-payment of rent for the “relevant period”.  The relevant period will be the time running from commencement of the Bill through until 30 June, initially and potentially any further extension issued by the Government.

Whereas there will be many businesses impacted by the Covid-19 outbreak, what is best for each landlord/tenant under will depend on the particular circumstances.

Oliver Ray is a solicitor specialising in commercial property law in the Property department at Barker Gotelee Solicitors in Ipswich.

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