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British retail faces "tsunami of closures" without rent help

Economic Indicators May 29, 2021 07:10PM ET
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© Reuters. FILE PHOTO: People walk past a closed shop following the outbreak of the coronavirus disease (COVID-19) in Chester, Britain, August 10, 2020. REUTERS/Phil Noble

LONDON (Reuters) - Britain's retail sector will endure a "tsunami of closures" if the government does not extend a moratorium on aggressive debt enforcement, industry lobby group the British Retail Consortium (BRC), said on Sunday.

Citing survey data it said two thirds of British retailers have been told by landlords they will be subject to legal measures to recover unpaid rent from July 1 when the moratorium ends.

Many UK retailers deemed "non essential" had to close their stores during multiple COVID-19 lockdowns over the last 15 months, accruing total rent debt of 2.9 billion pounds ($4.1 billion), the BRC said.

The pandemic has hammered the sector and industry data shows one in seven shops already lie empty.

The BRC's survey found 80% of tenants said some landlords have given them less than a year to pay back rent arrears.

Without action, the end of the moratorium could see thousands of shops close, said BRC chief executive Helen Dickinson.

She called on the UK government to allow the rent arrears built up during the pandemic to be ringfenced and the moratorium on repayment of these debts to be extended to the end of the year.

"With this in place, all parties can work on a sustainable long-term solution, one that shares the pain wrought by the pandemic more equally between landlords and tenants," she said.

"Without action, it will be our city centres, our high streets and our shopping centres that suffer the consequences, holding back the wider economic recovery.”

($1 = 0.7049 pounds)

British retail faces "tsunami of closures" without rent help
 

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Comments (3)
Dani Elín
Dani Elín May 30, 2021 1:50AM ET
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ellos quisieron el brexit
danny Levine
danny Levine May 29, 2021 9:55PM ET
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crying for more govt bailouts. I wonder we can ever live without a govt in the future?
Chris Hall
Chris Hall May 29, 2021 9:55PM ET
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remember the governments are the ones that demanded them to close ...
Roger Miller
Roger Miller May 29, 2021 9:46PM ET
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If rent arrears are not paid prepare for much worse. Landlords have mortgages to pay. Following that banks have reserve requirements that need to be met, funded in part by mortgage repayments. It doesn’t just stop with the retailers. Keep in mind also that pension funds are some of the biggest landlords.
Roger Miller
Roger Miller May 29, 2021 9:46PM ET
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This will test many governments central planning abilities.
 
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