On 7 May 2020 TMCP and Blake Morgan made available a process and accompanying guidance, via TMCP’s website, to help Managing Trustees whose non residential tenants were having difficulties in meeting their rental payments during the COVID-19 outbreak.

TMCP has seen a lot of activity on the website from Managing Trustees accessing the guidance and the questionnaire but to date we have noticed that there have not been many Managing Trustees who have contacted us about agreeing a rent concession with a non residential tenant. There may be many reasons for this.

One such reason may have been that tenants have been able to make monthly or quarterly payments up to now because of grants they have received from the Government. If that has been the case have the tenants considered how they are going to continue to meet their rental obligations? If the terms of the lease require quarterly rental payments, then the next quarter day when rent will be due from tenants is 24th June 2020.  Payment of the next 3 months rent, when the Government is only starting to ease restrictions on trading, may be tricky if a tenant is relying on customers ‘coming through the door’. It may take time for people to have confidence to go back into shops and other places, or consumers may have got used to obtaining goods and services online.

TMCP are keen to ensure that if Managing Trustees want to help their tenants who may have, or continue to, experience financial difficulties, the process is as straightforward as possible. It is also vitally important that any agreement is documented correctly so as to avoid any unintentional consequences to the lease which may negatively impact the parties down the line and which could ultimately be more costly.

To this end TMCP and Blake Morgan have revisited the questionnaire (available on TMCP’s website in the password protected area) which Managing Trustees are asked to complete when they are considering a rent concession with their tenant. The questionnaire is shorter and therefore less time consuming to complete. TMCP Legal are also on hand to assist Managing Trustees in completing the questionnaire if they are finding some of the questions more difficult to answer.

The legal fees for agreeing a rent concession are relatively low and even if the Managing Trustees pay those fees upfront the same could be recovered from the tenant through the overall repayment package agreed. The fees are also small compared with the fees that could be incurred later down the line if the rent concession is incorrectly documented.

We would encourage all Managing Trustees who have non residential tenants occupying Methodist premises to consider the process on TMCP’s website process before agreeing a rent concession. You can also contact TMCP Legal with any questions and your query will be dealt with as a priority.

You will find the following guidance on the dedicated COVID-19 page of TMCP’s website of assistance:

If you have any queries in relation to the guidance in this document please contact TMCP Legal for further assistance.