Rent debt threatens 330,000 hospitality jobs

7th May, 2021 by Kate Malczewski

The removal of rent protections for hospitality businesses in the UK could put 330,000 jobs at risk, according to a trade body.

UK Hospitality reports 330,000 jobs at risk due to rent debt

Despite periods of closure and trading restrictions due to Covid-19, many operators have not had rent reductions

The UK hospitality industry faces £2.5 billion (US$3.5 billion) in rent debt, part of the impact of Covid-19 shutdowns.

With the government’s ban on commercial evictions due to end in June 2021, UK Hospitality (UKH) conducted a survey gauging operators’ current standing on rent issues.

More than half of operators surveyed reported that they haven’t had a rent reduction from their landlord, even during periods of closure and trading restrictions. Just over half (52%) have not received any rent payment extensions, while nearly three quarters (73%) are unable or don’t know how they can pay their rent arrears. Two fifths of those surveyed haven’t been able to make an agreement with their landlord regarding rent concessions.

UKH’s analysis found that if the current rent protections are allowed to expire this summer, 332,000 hospitality jobs – one sixth of the industry’s workforce – could be lost.

Kate Nicholls, UKH CEO, commented: “Our survey shows that while a proportion of operators have been able to strike a deal with their landlords on payment of rent debt, for many there have been no concessions and little engagement on the issue. The issue of rent debt must be resolved in a way that shares the burden as businesses simply cannot be expected to pay their rent arrears in full.”

She urged the government to “take affirmative action” to aid the recovery of the hospitality industry.

“Government must extend and expand protections until the end of the year, and force the writing off of a fair amount of Covid rent debt,” Nicholls said. “The removal of protections would be disastrous and result in a huge increase in enforcement activity – meaning business failures and hundreds of thousands of jobs lost.”

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