The impact of COVID-19 on service charges in commercial properties

Abstract

The COVID-19 pandemic, and the resulting legislative measures and government guidance, have significantly affected all of our lives. This paper considers the implications of the financial difficulties faced by commercial tenants on the landlord/tenant relationship. The paper highlights issues in the practice of landlords, and surveyors advising them, in relation to works and services that come within the service charge provisions of a commercial lease, as well as examining how recent legislative interventions have limited recovery options for landlords faced with service charge arrears. The paper investigates the need for communication between parties to try to resolve difficulties the tenant may have meeting its financial obligations under the lease, as well as the need for any agreements reached to be properly documented in order to provide clarity and certainty for both landlords and tenants going forward.