16 Jun 2020
Nick Stewart, partner at MMX Retail comments on the Budget’s business rates impact
Nick Stewart, partner at MMX Retail, said:
“Again, many retail landlords will be left disappointed by the business rates announcement in today’s Budget. Many had hoped for a higher threshold than was announced by the Chancellor. These savings are paramount to any investment into the retail landscape and we all know that needs to happen now.
“Firstly, business rates reform will right a longstanding wrong in the online/offline retail war, but also it will allow the retailer to invest in stores, staff, experience and ultimately the health of the high street. However, it won’t stop retailers asking for rent concessions and it won’t shift the balance of power to the landlord. We all know there is too much retail real estate and retailers can’t un-know the derisory rents that landlords have agreed to of late. This has created a game of chicken that is a lease negotiation heavily weighted in the retailer’s favour: landlord quotes new rent, retailer threatens not to renew, landlord looks for new tenant, none available, landlord forced to accept incumbent tenant’s unsavoury terms. Sound familiar?
“What landlords should consider is how to partner with their retailers to reinvest in stores and staff – improving the experience for shoppers and giving the public reason to keep visiting shops in person – but ultimately we need much more meaningful change.”