Commercial Property Wars
The Bottom Line
BBC
4.6 • 615 Ratings
🗓️ 5 November 2020
⏱️ 28 minutes
🧾️ Download transcript
Summary
Commercial landlords and tenants are at odds over unpaid rents due to the pandemic. Many retail, hospitality and leisure businesses are suffering acutely. Most have landlords who collect rent for their premises. In turn, many landlords have to pay interest on their loans to the banks. The pandemic is upsetting that delicate financial balance. It's estimated that billions of pounds is owed to landlords in unpaid rents. Threats of legal action against tenants are hitting the headlines. Just who should take more of the financial hit - commercial landlords or their tenants?
Guests
Edward Ziff, Chair and CEO of Town Centre Securities, a property investment firm Mark Dixon, CEO of International Workplace Group, which rents, develops and sublets office space and Charlotte Heyes, director of the small pub chain, Common and Co
Transcript
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| 0:00.0 | Hello and welcome to the programme. |
| 0:06.8 | One of the things that is being driven haywire by COVID is the value of commercial property. |
| 0:13.5 | Retail, hospitality and leisure have been devastated, unable to see when normality may return. |
| 0:20.0 | A lot of businesses are suffering. |
| 0:21.6 | But what we wanted to do today was ask a simple question. |
| 0:25.6 | How much of that hit to revenue is being passed down to the landlords in reduced rents? |
| 0:31.6 | Now there is a theory in economics that in the long term, |
| 0:34.6 | landlords need viable tenants. |
| 0:36.6 | So any problem of the tenant ends up hurting the bank balance of the landowners. |
| 0:41.7 | It's not a mad theory. |
| 0:43.1 | For example, if a well-run shop can't make a profit at the existing rent, |
| 0:47.5 | and if the landlords can't use the retail space for anything other than a shop, |
| 0:51.5 | well, the rent has to drop until the shop is viable. Well, |
| 0:55.4 | what is happening on the ground right now? Who is taking the hit? How badly affected are the |
| 1:00.2 | property companies and with what consequence? I have two guests with strong views on that topic. |
| 1:05.9 | Let us meet them. First, Edward Ziff, chair and chief executive of town centre securities. It's a property investment firm. |
| 1:14.1 | Edward, you are a commercial landlord. Tell us a little about town centre securities. |
| 1:19.8 | So town centre securities is a small publicly quoted company, significantly family owned. |
| 1:25.8 | We've been going 50 years, a bit longer, 60 years. And I have to say |
| 1:29.9 | in the 30 odd years that I've been in the business, this has to have been the hardest thing |
| 1:34.7 | that I've had to deal with. This has just ravaged everything. And all the way through, |
| 1:40.3 | it's not only retailers, its office occupiers, it's industrial, commercial, it's everything. |
... |
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