Landlords urged to make ‘concessions’ to struggling businesses

The Government has urged commercial landlords to provide “concessions” such as rent reductions and rent-free periods to tenants struggling to meet their financial obligations as a result of the Covid-19 crisis.

The request is part of a new voluntary code of conduct on commercial rents and comes amid a pick-up in disputes over rents arising from the pandemic.

The code, which is aimed at avoiding disputes and cushioning the impact of the crisis on hard-pressed businesses, was agreed between landlords and business representatives.

It urges landlords to provide concessions where they can and, where this is not possible, to set out clearly the reasons for this.

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It suggests full or partial rent-free periods, splitting the cost of rent between tenant and landlord, and says rent reductions should be considered as temporary arrangements where the tenant cannot pay in full.

"Nobody wants to see vacant premises in our towns and villages or our shopping centres," the Tánaiste and Minister for Enterprise, Trade and Employment, Leo Varadkar, said.

“Landlords should be willing to do what they can to help their tenants to continue to operate rather than facing the risk of a vacant premises and inability to obtain new tenants,” he said.

“Equally, tenants should pay what they can and speak with their landlord when difficulties arise. The code sets out how both parties can work together to get through these uncertain times,” he said.

The code, which was promised in the Coalition’s programme for government, will apply until July 31st next year.

Financial pressure

It comes as many businesses find themselves under intense financial pressure as a result of the Covid restrictions.

The Restaurants Association of Ireland recently called on the Government to take urgent action to help businesses deal with landlord disputes linked to the charging of full rent rates during the pandemic.

The industry group claimed certain “greedy landlords” were “not playing their part” in helping tenant businesses manage the crisis.

The code, which was developed in consultation with relevant stakeholders, is based on an approach taken in other jurisdictions, including Australia, France and the UK.

"This is a complex issue and there was broad agreement among stakeholders on all sides that Government could not intervene in the market in a heavy-handed way, but we are conscious some steps needed to be taken to address the impact Covid-19 has had on commercial rents and leases," the Minister of State for Business, Employment and Retail, Damien English, said.

“This voluntary code of conduct sets out best practice and will help facilitate conversations between commercial landlords and tenants. It is a common-sense approach to tackling an issue facing many businesses across the country,” he said.