By Tom Drake
Partner
Drake Commercial
WHEN this article was first drafted, it commented on how the new Government’s first budget provided welcome relief for struggling retail and leisure companies. It offered business rates relief for next year, providing companies with a ‘rates holiday’ which applied to properties with a rateable value of less than £51,000 to firms including shops, gyms, cinemas, restaurants and hotels.
“That is a tax cut worth over £1bn, saving each business up to £25,000,” the Chancellor said and I went on to comment how this would be a welcome boost, helping businesses and the economy as a whole.
The world has, however, moved on since then, and the threat of coronavirus is now being taken much more seriously (if it wasn’t already), causing the Government to introduce measures encouraging people not to visit the likes of pubs, restaurants, cinemas and theatres. This is already having a severe impact on these venues, as you would expect and some have taken the decision to close during this period.
Subsequently, the Government has reacted to try to offer further measures, although we anticipate that more support will be needed over the coming weeks and months. At the time of writing, £330bn in loans (equivalent to 15 per cent of GDP) was being made available to help with rent, wages and other overheads. Cash grants of up to £25,000 are also being offered to specific small businesses to try to help them balance the books.
It was also announced that the position with insurance companies has also been clarified, making it clear that claims were valid, despite no formal instructions for businesses to close. And, lastly, it has been agreed with mortgage lenders to offer a three-month holiday where needed, with the intention again to free up finances during what we hope is the most difficult period.
As touched on, depending on the extent of time that these more stringent measures are in place, it is likely that more will be needed from the Government to minimise the long-term impact.
From our point of view, whilst we are following government measures on how best to continue working, there is still plenty to do and there seems to be a determination from all to carry on as best we can. Many companies and individuals seem to be using the period to perhaps secure new premises whilst their operation is slightly quieter, or are dealing with property matters they otherwise don’t get around to.
If you need to discuss any of your commercial property needs, we are set up during this period to continue to assist. We have even introduced ‘contactless’ viewings to help businesses continue to review their property requirements.