What if your commercial lease tenant can’t pay during Covid?


Many commercial lease tenants have been unable to pay some or all of their rent during the Covid 19 pandemic. Some landlords have been able to agree a rent concession during this time, but some have been struggling financially themselves.


Concessions during the pandemic


Unlike residential tenants, commercial tenants have no mandatory right to rent holidays or reductions in rent. This is entirely at their landlord’s discretion. While many landlords have granted such holidays, this is by no means the case across the board. Although it is generally in the landlord’s interest to keep their tenants during these unusual times, there are situations which have made such agreements impossible for one or both parties.


Some businesses have been able to stay open, such a mechanics and bike shops– but what if your tenant runs a different business?


At the moment there is legislation prevention landlords from beginning forfeiture proceedings against tenants for non-payment. At present this is due to end on the 31st December 2020 but is likely to be extended due to the implementation of a new national lock-down beginning on the 5th November 2020.


However, landlords can still continue to demand rent from their tenants and issue forfeiture proceedings against them for reasons other than non-payment of rent.


Landlords- What can you do to get your money?


Landlords can still use any rent deposit paid by their tenants in lieu of rent, and they can also claim monies from a guarantor if one was put in place at the beginning of the contractual agreement.


Consider a Mutual Agreement


There can, and have, been cases where both parties have agreed to dissolve the contract because it benefits both parties.




During these unpredictable and unprecedented times, it is important for all parties to communicate with each other clearly. Sometimes this can be done directly, but in some situations, it may be pertinent to instruct a solicitor to act on your behalf. This will ensure that each party has a full understanding of the laws currently in force. This is particularly important as they are subject to change.