Peter Thornton, Australian CFO of live-music venues The Piano Works, alongside David Abramson, CEO of leisure property advisors Cedar Dean, are leading the charge, which has backing from Rob Pitcher, CEO at Revolution Bars Group, Menashe Sadik, founding director at Chopstix Group, Alex Salussolia, MD at Glendola Leisure and Tom Kidd, director and co-founder at Adventure Bars, among others.
Under the Australian scheme, the government has made it mandatory for landlords to agree to a reduction in rent payable, of up to 100%, in proportion to the reduction in the tenant’s business during Covid-19.
The scheme has mandated that landlords waive 50% of the total reduction in rent payable and accept deferral of the remaining balance paid back in instalments over the remaining time on their lease.
Landlords also cannot draw on a tenant’s security for the non-payment of rent (be this a cash bond, bank guarantee or personal guarantee) during the period of the Covid-19 pandemic and/or a reasonable subsequent recovery period, while banks offer leniency on payments owed for the duration of the scheme to ensure that landlords remain afloat.
The group of UK operators have said this creates a viable solution for all parties and would help businesses survive past the end date of the rent moratorium.
An open letter has been sent to the Chancellor of the Exchequer, Rishi Sunak, Secretary of State for Business, Energy and Industrial Strategy, Kwasi Kwarteng, Secretary of State for Housing, Communities and Local Government, Robert Jenrick and Secretary of State for Culture, Media and Sport, Oliver Dowden, to consider the proposal.
Abramson said: “This crisis requires bold steps from government and with many landlords already giving 50% reductions, the Australian model will simply legislate for the landlords that haven’t yet done this. We know this would be a big move, but it would take away so much uncertainty and allow businesses to focus on keeping jobs and rebuilding trade once they can re-open.”