The UK hospitality sector could be facing a “bloodbath” unless urgent action is taken to support struggling businesses through the Covid-19 pandemic, advisers and operators have warned.


Leading figures in the sector are urging the government to offer more support to businesses hit hard by the the nationwide lockdown.

The owner of London venue Milk & Honey and Street Feast founder Jonathan Downey this week called on the government to introduce a nine-month rent-free period for retail, hospitality and leisure operators across the country, with rent payments continuing as normal from January 2021.

To make up for the lost income, Downey said leases should be extended by nine months. He added that landlords should be allowed to push back loan repayments to mitigate income loss where debt was “secured on premises benefiting from the rent postponement”.

Downey told Property Week he hoped to present to the government a joint approach between landlords and businesses .

“It’s starting to gain momentum and landlords are gradually getting on board,” he said. “Some landlords need to realise years of empty premises will be far worse than nine months of postponed rent. Half of landlords’ tenants will be gone by the end of this year if something like this doesn’t happen.”

Celebrity chef Yotam Ottolenghi joined the call for a “national time-out” on rent payments, saying government should allow restaurants to withhold rent until the end of the year and compensate landlords accordingly.

Property advisers also called for more help for the hospitality sector this week.

Richard Russell, head of lease advisory at The Lorenz Consultancy, said: “If something is not done or there isn’t a change in the moratorium, there could be a bloodbath out there, with a number of restaurants closing and never reopening. There will be casualties whatever happens, but the number of casualties is dependent upon how the relationship with the landlord and tenant goes.”

Ross Kirton, head of leisure agency at Colliers International, added: “It’s unclear how long the ban on non-essential travel and thus closures will last, but landlords should be mindful of maintaining longer-term relationships with tenants after Covid-19. Landlords would be in a far worse position if they got back possession of empty units and had to remarket in the current climate.”

The calls came after a number of gyms and leisure centres said they faced being evicted from their premises because landlords were using a legal loophole to penalise them for non-rent payments – putting 2,800 gyms at risk of permanent closure.

The Coronavirus Act 2020 does not prevent landlords from pursuing commercial rent arrears recovery, debt claims, statutory demands or winding-up proceedings – any of which could be “lethal” to businesses generating no income, gym operators said.

UK Active, which represents fitness companies including David Lloyd Leisure and PureGym, said the government must reduce pressure on landlords by introducing financial support for a rent holiday, preventing them from resorting to legal action.