Rent debt: 75% of late-night venues face bankruptcy without government intervention

Some 75% of late-night venues face bankruptcy without a solution to the growing rent crisis facing the industry, MPs have been told.

The Night Time Industries Association (NTIA) warned that hundreds of thousands of jobs will be lost without a government solution to the £2.5b rent arrears owed by the sector.

Appearing before the All-Party Parliamentary Group for the Night Time Economy yesterday, the NTIA said businesses face a "cliff edge" when the ban on commercial evictions ends in July and landlords can demand payment.

Large parts of the late-night sector, such as nightclubs and and entertainment venues, have been closed since March 2020 and have no way to repay their debts.

Peter Marks, chief executive of nightclub operator Rekom UK, said: "Many landlords will not engage unless they are forced to by the government, and we have seen plenty of evidence of that across the sector."

A May 2021 survey of 360 businesses by the NTIA and Cedar Dean Specialists found 80% were facing unproductive discussions with their landlords, 93% had already seen substantial job losses and 70% believed that there will be further redundancies post-moratorium.

More than 90% were in favour of an Australian-style solution, which is a shared burden between tenants and landlords.

The NTIA has proposed a similar solution and the Ministry of Housing, Communities and Local Government has held a consultation on the issue, but is yet to put forward any policy proposals.

Peter Hunter of the Botanical Garden pub in Liverpool said: "The variance in how landlords are approaching the current rent fees, proposed increases and rent debt is mammoth. A lot of them just pretending that the pandemic hasn't happened and that they are due large rents based on a very different economic landscape from what we've experienced and are going to experience."

Jeff Smith, Labour MP for Manchester Withington and co-chair of the All-Party Parliamentary Group for the Night Time Economy, said: "The government needs to urgently consider potential solutions, such as a shared burden model and loans to enable longer-term debt restructuring. I would welcome the opportunity to work with the government towards a solution that helps steer these businesses out of the precarious position they find themselves in."

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