Commercial leases: Crisis guidelines

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Economic Development Minister Lyndon Farnham has published the guidelines to help parties resolve property issues, with many businesses forced to close or facing large revenue drops due to the crisis.

The Guidance for Commercial Property document suggests a framework of voluntary steps for landlords and tenants to follow when dealing with matters relating to financial hardship or inability to meet lease obligations.

Suggested arrangements include rent/payment deferrals and holidays, as well as early termination of leases.

Graeme Smith, chief executive of Jersey Business, urged commercial landlords and tenants to follow the guidelines, which aim to promote ‘appropriate behaviour’ to resolve disputes or differences.

‘If you look at the landlord and tenant guidance that has been given out, Jersey can and could still legislate in that space instead,’ he said.

‘But that can be quite draconian, quite challenging, and could have unforeseen consequences.

‘What they’re trying to do is just to ensure that there’s a sensible conversation between a landlord and the tenant.

‘So I think what they’re doing in that space is very powerful without changing the law per se.’

Senator Farnham said that he hoped landlords and tenants would work together using the guidelines.

‘This guidance aims to offer another level of security for those businesses and individuals who may find themselves struggling due to the coronavirus outbreak,’ he said.

‘The government doesn’t want to see any business falter during these times and it is our prerogative to ensure suitable measures of support are given, not only with regards to financial problems, but also any legal issues which may arise.

‘The guidance offers a balanced approach to ensure neither tenant nor landlord are unfairly disadvantaged.

‘I hope this means people can continue to work together, with a long-term approach, to maintain robust and reasonable behaviours which will protect our local economy.’

More information can be found on the business page of the government support website.

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