Access All Areas May 2020 | Page 12

MAY | FEATURE “N o-one should be profiting from Covid-19. At the moment, landlords are profiting. It’s as simple as that.” Jeremy Joseph, owner of G-A-Y and London’s largest LGBT nightclub Heaven, puts it plainly. The UK’s music venues are collectively facing an existential threat. Covid-19 has forced their closure for the foreseeable future, and some landlords seem to be using the opportunity to turn a profit, charging full rent to businesses with zero income. It is fair to say the government is aware of these issues, but as of yet there has been no official guidance Close to the edge Without regulations on rent, many UK venues are facing a second crisis - paying their landlords. Stuart Wood investigates Above: Heaven, photography by Chris Jepson about how businesses are expected to deal with rent, which is in many cases their biggest expense. For the bars, pubs and clubs that are unable to bring any money in during lockdown, it could be fatal. What the government has done is to establish a three- month ‘crisis period’ in which tenants cannot be evicted. Businesses are advised to negotiate with their landlords on a discretionary, case by case basis. But Joseph says there are loopholes being exploited. “Landlords are playing a very clever trick,” he says. “The government has said that you cannot evict a tenant during the crisis period of the next three months. So instead, they are deferring those rent payments. That means as soon as those three months are up, and you’re three months’ rent in debt with no income – oh, look – now they have the power to evict you. It’s a very dangerous game being played here.” Joseph took his frustrations public after receiving no word from government about the rent situation in the UK. He says he wants legally binding regulations for landlords, in order to prevent them profiting from vulnerable businesses. Specifically, Joseph mentions The Arch Company (ArchCo), RDI REIT and Soho Estates, which respectively own the leases on Heaven, G-A-Y Bar and G-A-Y Late. ArchCo says it is offering three months’ rent free to small businesses, although the parameters that define ‘small business’ are not entirely clear. A spokesperson for RDI REIT commented that “we continue to engage with all our tenants and offer support where we are able to do so. Joseph, however, says the company has not replied to any of his recent emails. John James, Managing Director of Soho Estates, spoke to Access and explained his company’s position: “We are very aware that the hospitality sector will be the last out of lockdown and will then take the longest to recover. You must also appreciate that landlords have their own financial obligations and are usually held by bank covenants which if breached will result in property companies going into liquidation. “We have contacted all our tenants and with only a few exceptions have come to agreement on how we help them survive and look to recovery.” Financial pressure It may be in the interests of landlords to turn over new tenants for one simple reason: existing tenants must be negotiated with when it comes to price, but new tenants 12