Property, construction and development
Covid-19 has now been labelled a pandemic but what impact is it having on the real estate sector and what challenges are commercial landlords and developers coming up against?
In outline, the immediate impact of coronavirus on real estate falls into the following main areas:
- For commercial lettings, issues are about obligations, access to properties and impact on rent and service charge (see under “Premises”);
- For short term residential lettings, the same issues but also how the premises might be affected by an occupant/visitor contracting Covid-19;
- For buildings let on long residential leases, issues around maintenance and cleanliness of common parts and service charge recovery;
- For property transactions, the risk of delay putting a contracting party in breach, e.g.:
- failure to perform mandated steps in the transaction
- a critical person contracting Covid-19 and going into self-isolation
- a premises needing to be deep cleaned
- delay in execution of a document, whether signature or witnessing or returning to lawyers
- Funding for acquisitions or developments being impeded by delays in complying with loan pre-conditions;
- Planning permissions and other statutory consents being delayed by staff shortages at the local council or elsewhere;
- Construction and development obligations being affected by:
- shortages of people to carry out general construction operations
- interruptions in the supply of relevant materials
- absences of key individuals in areas such as design, survey, valuation, certification
- delays in the issue of necessary statutory or other consents
- Values of properties, particularly retail and leisure, may decline (at least in the short term), potentially affecting:
- banking covenants owed to current lenders
- funding for acquisitions and developments
- balance sheets and rental flows
If you are concerned about any issues relating to your property or development get in touch with one of our team who can help.
RE: Occupy - Real Estate FAQs for Tenants during Covid-1924 November 2020
The impact of Covid-19 is constantly changing for the real estate sector: from construction sites and developments being shut down; to new approaches for planning inquiries and a mutable landscape for lease negotiations. Nothing is set in stone. Therefore, we have pulled together a selection of the questions we are being asked by clients and will be updating this regularly.
FAQS on Covid-19 planning reforms23 November 2020
The Government believes the planning system is ‘broken’ and in June the Prime Minister promised the most radical shake up of planning since WWII in order to get Britain building again. There followed a series of legislative changes over the summer to both Permitted Development Rights and to the Use Classes. The Government wants to introduce further reforms as set out within the white paper Planning for the Future and the consultation paper on Changes to the Current Planning System.
Government imposes moratorium on statutory demands and winding up petitions22 June 2020
The government has announced that it will temporarily ban commercial property landlords from issuing statutory demands and winding-up petitions against tenant companies unable to pay amounts owed under their lease due to coronavirus.
Coronavirus Act 2020 and forfeiture of leases22 June 2020
The government is racing to try to protect tenants’ interests, with the Coronavirus Act 2020 coming into force on 26 March.
COVID-19 advice for corporate occupiers22 June 2020
Commercial tenants – whether occupying offices, retail premises, industrial units or other property - face potentially existential questions arising out of their landlord and tenant relations, how to manage cashflow and outgoings as revenues dry up, premises shut down and uncertainty reigns.
Covid-19 relief for financially troubled suppliers with public contracts01 April 2020
On 20 March 2020 the Cabinet Office published guidance designed to ensure that all public bodies provide support under existing contracts to suppliers of “goods, services and works” who are financially “at risk” as a result of the COVID-19 outbreak.
Covid-19 – Legislation now passed for new PD rights25 March 2020
The Government is responding quickly to the current crisis with new legislation. On the 21 March, The Health Protection (Coronavirus, Business Closure) (England) Regulations 2020 were issued requiring the immediate closure of businesses selling food or drink for consumption on the premises including all restaurants, cafes, bars and pubs.
COVID-19 and tech solutions for planning24 March 2020
The industry appears to be split about the use of technology in the decision making process. Last week, the Planning Inspectorate issued guidance that confirmed all site visits would be cancelled and two local plan examinations due to take place were postponed.
Businesses are facing many real and unique challenges as the world responds to COVID-19.