Commercial Tenancies During Covid-19 Crisis

The Emergency Measures in the Public Interest (Covid-19) Act, which was signed into law on 27th March 2020, does not give any relief to tenants in commercial premises.

While substantial relief is available now to residential tenants, no such relief is available to commercial tenants. Rent and covenants continue to run during the Emergency Period, unless a lease makes specific provision to the contrary.

Many tenants will be unable to pay their rents and will be in breach of their lease conditions. Early engagement with landlords is advised and it is in both parties’ interests that a realistic adjustment should be made.

Since the available advice is that this is a temporary emergency, any agreements reached should be treated as temporary.

Landlords should be careful that any concession on rent should be regarded as forbearance and not an agreement to vary the rent.

Tenants should be careful that in reaching agreement with their landlord, they will not be regarded as having breached the terms of their lease if they meet the terms of any temporary arrangement.

It is vital for both parties that any agreement is recorded in writing.

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