Press release

LANDLORDS HELP STRUGGLING RETAILERS

Date

22nd July 2008

Description

Commercial landlords have backed a campaign by the BRC to offer retailers a helping hand during the economic downturn.

The British Property Federation, which represents the UK property industry, has said that 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.

Although the average new commercial lease is now 5.7 years1, some retailers have complained of being in financial trouble because of having to pay rent three months in advance.

Landlords have said they would be happy to consider monthly payment terms as part of new lease negotiations, which has been the focus of the BRC’s two year campaign.

The BPF’s Commercial Landlords Accreditation Scheme (CLAS)2 highlights landlords committed to offering the best service. The BPF is encouraging more landlords to sign up to it via www.clascheme.org.uk

Liz Peace, chief executive of the BPF, said:

"It goes without saying that landlords want to help any tenant genuinely in trouble. Landlords are committed to providing their customers with a high quality service. 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. Retailers who are in trouble will find landlords willing to explore options to help them.

“Commercial landlords are always willing to discuss flexible terms with their customers – but any changes would have to be negotiated into the contract and would take account of the financial position of both sides.

"The BPF's Commercial Landlord Accreditation Scheme (CLAS) offers tenants the security of knowing their landlord abides by the highest standards of service. Many BPF members are signed up to CLAS. We hope that those who are not signed up will join and help us continue to improve both service standards and the business environment for our members and their tenants."

Stephen Robertson, director general of the BRC, said:

“I welcome the position of the BPF to support monthly rents, and commend its members for being open to negotiating more flexible rental terms with retailers.

“Following our successful rent monthly campaign, rents are being offered on monthly terms for new leases almost as standard practice. The leadership of BPF members has helped drive this, and we encourage other commercial landlords to follow their lead.”

Peter Best, PRUPIM's head of asset management, said:

"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. Occupiers who need unconventional payment arrangements should talk directly to us to explore the options."

Barry Judd, estate manager with Simmons & Hawker Limited, an accredited member of CLAS, said:

“We wholeheartedly support the BPF’s statement in this matter. It completely summarizes our own attitude to the issue; if a tenant has a problem, any problem, please come and talk to us about it. You will invariably find us accommodating.”

Roger Bright, Chief Executive of the Crown Estate said:

“The Crown Estate believes in a long term proactive relationship with customers. Flexibility on initial leasing together with an understanding approach during the lease period is at the heart of our approach. Tenants will benefit from choosing landlords who, as The Crown Estate, are signed up to CLAS.”

A statement from British Land reads:

“British Land is not averse to discussing monthly rents with its customers.

“On any new leases British Land is very happy to consider monthly payments as part of the entire commercial transaction, in the same way that we review rental levels, lease lengths, rent free periods etc.

"Any requests for changes on existing leases would be considered on a case by case basis, however these are unlikely to change unless there is a clear benefit to the company."

For more information, please contact:

Andrew Teacher, head of media, British Property Federation – 020 7802 0113 / 07968 124545

BRC Press Office - 020 7854 8924 / 07921 605544 (out of hours)
Notes for editors

1. Average new commercial lease at 5.7 years

This figures is taken from the annual lease review undertaken jointly by the British Property Federation. and Investment Property Databank (IPD).

View the most recent report at:
http://www.bpf.org.uk/pdf/20970/BPF_IPD_Annual_Lease_Review_2007[1].pdf

2. Commercial Landlords Accreditation Scheme (CLAS)

The BPF launched this accreditation scheme to encourage tenant-friendly leasing and to highlight commercial landlords committed only to the highest levels of service.

The Commercial Landlords Accreditation Scheme (CLAS) guides businesses towards landlords who offer a wider range of flexible, manageable leases, who understand business needs and who deal with their customers' complaints fairly and quickly.

Anyone bearing the CLAS badge will be committed to the new commercial lease code, will have procedures in place to handle tenants’ concerns, and could face disciplinary action if the scheme’s rules are broken.

The full list of CLAS members and information on its rules can be found at:
www.clascheme.org.uk

Downloadable documents

LANDLORDS HELP STRUGGLING RETAILERS - 71kB.

Retail Week feature page1 - 2MB.

Retail Week feature page1 - 2MB.

Letter to Retail Week - 3MB.