Poor March rental collection pushes Covid shortfall to £5.3bn
Landlords across the UK are owed more than £5.3bn in unpaid rent, according to the latest research from Remit Consulting.
The figure is the total rent arrears for the 12 months since the beginning of the Covid-19 pandemic and the government’s moratorium on rents.
Remit’s analysis of the most recent quarter reveals that overall, less than half of the rent payments due on March quarter day were received by property managers – the worst collection rate since June last year.
Landlords across the UK are owed more than £5.3bn in unpaid rent, according to the latest research from Remit Consulting.
The figure is the total rent arrears for the 12 months since the beginning of the Covid-19 pandemic and the government’s moratorium on rents.
Remit’s analysis of the most recent quarter reveals that overall, less than half of the rent payments due on March quarter day were received by property managers – the worst collection rate since June last year.
Overall rental payment percentages for the March 2021 quarter totalled 46.4% according to Remit, a decline on the previous two quarters where rent payments had topped 50%. The June quarter was the poorest quarter for rent collection, with just 37.8% of rents collected.
Across sectors rent collection has declined over the past two quarters. In retail this fell from 45.8% for the December quarter to 42% this March. In leisure these percentages have fallen from 28.8% to 22.7%, and in offices from 71.2% to 63%. Even in industrial, where rent collection has generally remained robust, Remit’s figures show a 62.1% collection rate for the December quarter dipping to 58.4% for the March 2021 quarter.
“Over the 90 days of the December quarter, the shortfall experienced by investors, many of which are pension funds, insurers and other institutions, totalled more than £1.1bn with 78.6% of the rents due collected overall,” said Steph Yates, a senior consultant at Remit Consulting. “While this figure is generally in line with the previous three quarters of the pandemic, there were some concerning trends within the different sectors that we study, with the rent collected on leisure properties (restaurants, pubs, etc) falling by nearly 6% compared to the previous quarter. The same comparison for retail properties saw a fall of nearly 3%.”
Remit’s analysis is based on financial reports from national firms of property managers responsible for 125,000 leases on more than 31,000 prime commercial properties across the country.
To send feedback, e-mail samantha.mcclary@egi.co.uk or tweet @samanthamcclary or @estatesgazette
Image © Universal Images Group/Shutterstock
