In May 2011, the government appointed Mary Portas to lead an independent review into the future of the high street. To identify what government, local authorities and businesses can do to promote the development of more prosperous and diverse high streets.
On 13 December 2011, the Portas Review was published which sets out Mary Portas' recommendations.
Below, we consider the recommendations which are likely to be of particular interest to landlords and their role in supporting the High Street.
Landlords should act fairly towards their tenants.
The report urges landlords to:
- sign up to the Code for Leasing Business Premises 2007 and to raise awareness of it
- consider alternatives to upward only rent reviews, i.e. reviews based on turnover rent
- accept a monthly rent payment to help tenants' cash flow
The government should explore further disincentives to prevent landlords from leaving units vacant, such as:
- removing empty property rates relief if the landlord is not actively investing in the property
- imposing financial penalties on landlords with a high proportion of vacant properties
The government should support landlords who allow their properties to be used as part of the “meanwhile project”.
These leases are intended to encourage the temporary occupation of empty town centre shops by occupiers who can contribute to the viability and vitality of town centres but who would otherwise be unable to afford normal commercial rents. The intended occupiers are for example, local voluntary or charitable groups, information centres, artists and musicians, who will be able to use a vacant property temporarily and rent free for a non-commercial purpose, while the landlord looks for a permanent new tenant.
The benefit for landlords is the chance to reduce their property costs, avoid empty property rates, and ensure that the building is maintained whilst also having the legal assurance of getting the property back quickly once they can let it commercially again.
Local authorities should:
- be given powers to step in when landlords are negligent in leaving premises empty and make new "Empty Shop Management Orders" to take control of unoccupied dwellings that are privately owned. This may be less time-consuming and costly than using compulsory purchase powers.
- create a public register of high street landlords to encourage more landlord engagement.
The government plans to publish a response to the recommendations in spring 2012.