Despite all the uncertainties of recent years, the retail property market continues to function and leases continue to be renewed. One development of that is over recent months, we have seen an increasing trend of national retailers trying to take advantage by flexing their muscles looking for unreasonably favourable deals.
Pressure for discount retail rents
Acting for several landlord clients, we have seen very aggressive notices being served demanding new leases at hugely discounted rents and with terms completely in the retailer’s favour. When these notices arrive in the post unannounced it is causing disquiet, particularly for private landlords not familiar with the lease renewal process.
Most leases are protected by the 1954 Landlord and Tenant Act that helps not only the tenant but also protects the landlord’s rights to fair new lease terms. If you receive a notice, the important thing is not to panic and give things away as with advice the outcome can be much better than you think.
Once discussions commence it is becoming apparent these notices are being served without a surveyor’s input or any appraisal of market rent. The retailer’s surveyors I have had contact with have usually not even visited the shop or know the notice had been sent.
Many locations in the Southwest have not suffered as badly as the retailers would like to suggest and evidence is often available to resist their demands. Vickery Holman has completed lettings in several locations at even higher rents than in the past. Whilst it is a time for landlords to be realistic they do not need to be taken for granted or give away discount retail rents.
