Retail property rent collection has fallen compared to the previous quarter, while other markets have performed closer to pre-pandemic levels.
According to Remit Consulting’s latest research, while the rate of collection of rents in Q1 is broadly similar to those seen in the previous quarter, in certain sectors like retail, rent payment rates have fallen.
The research shows that at the 35-day mark after December’s quarter day, payments by retailers were down around 5% compared to the equivalent period of the previous quarter.
“In the office and industrial markets, we recorded rent collection rates of 89.8% and 86.8% respectively,” said Steph Yates of Remit Consulting.
“However, the situation in the retail market has deteriorated over the last three months and, after 35 days of the current quarter, only 45.9% of rents had been collected from high street retailers and just 31.6% of rents had been collected from pubs, bars and restaurants.”
The research also reveals that, overall, the figures for rent and service charge collection are following a similar pattern to that witnessed in the previous quarters of the pandemic, and suggest that, by the end of March, there will be a further shortfall in the income of landlords of around 20%.
Laura Andrews of Remit Consulting, added: “If the rate of collection of rents from commercial occupiers continues on its current trajectory, we can expect a total shortfall over the first 12 months of the pandemic of around £5.5bn-£6bn.”
The next quarter day will coincide with the anniversary of the first lockdown of the pandemic, along with the end of the government’s moratorium of the eviction of commercial tenants for non-payment of rents due to Covid-19.