Low rent review activity likely to continue, says agent

A leading property agent is predicting further low levels of rent review activity as tenants, hit by the tough market conditions, continue to oppose any proposed increases.

In its latest annual rent survey Fleurets said landlords were accepting that the current trading environment meant that there was "limited opportunity for rental growth".

This, Fleurets added, has been compounded by many leasehold operators agreeing restructured lease deals directly with their landlord, who is faced with the alternative prospect of having the keys handed back.

"Consequently lower volumes of rent reviews are being actioned. Where reviews have been actioned, many remain outstanding. The disparity between landlord's expectations and tenant's ability to pay continues to cause dispute," the report said.

However, the report added that despite an expectation that one would see a greater fall in rent levels, the provision in many cases of upward only rent reviews meant that where the market rent is below the passing rent the higher rent is what gets reported.

Among traditional pubs, the South East of the country saw the highest regional rents, with an average of £52,252, while the North has the lowest average rents, at £39,801.

The Midlands experienced the highest rental growth over the last five years, at 23.1 per cent, while the North of the country saw a year-on-year decline over the last three years, the report found.

Among the A4 high street bar market, Fleurets found that the West End of London continued to produce the highest rent in the country, while Outer London had seen virtually no rental growth for the last five years.

In the rest of the UK all regions show rent growth "well below inflation over the last five years".