Landlords’ cash cut

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Landlords with commercial properties are being forced to downgrade revenue forecasts as tenants seek to renegotiate leases, fail to pay rent on time or default on payments, says business intelligence specialist Creditsafe.

Research by the firm has revealed that more than half of Britain’s commercial property managers have experienced tenants trying to renegotiate and almost a third have experienced late payments or defaults. “Many multi-year leases agreements were negotiated when the market was buoyant and many firms now find themselves tied into tenancy agreements that they simply cannot afford,” says Creditsafe’s business development director David Knowles.

“The retail sector has been particularly badly affected with leading brands negotiating with landlords to try and remain afloat amid torrid trading conditions on the high street.” Rents have a major impact on retailers’ viability and there has been an unprecedented demand from retail outlets to review their leases.