COVID-19: State of the Occupier Update - Southeast & Greater London

Most office occupiers are working from home with only essential functions continuing to physically report for work.

Occupiers are looking into the myriad issues that can arise under English leases, including how to manage an exit when inside of the 1954 Act, which provides security of tenure, and how to break leases when that is an option. They are also looking to change payment terms from quarterly to monthly or even defer payments and amortize the costs over the rest of the term. Project execution issues they are facing include how to undertake dilapidation works when no one is onsite and managing fit-out schedule delays.

OCCUPIERS?

Many occupiers are seeking rent relief or abatements from landlords or looking for alternative structures.


LANDLORDS?

Most landlords are taking a pragmatic view of tenant requests for relief.


DEVELOPERS / INVESTORS?

Developers are offering additional incentives and early access to fit-out spaces prior to the lease commencement.

Occupiers with lease events in 2021 should be looking for ways to stretch their decision timelines. Tenant representatives are having success renegotiating existing terms with landlords, though each landlord is different. Occupiers needing more time to fit-out their spaces have options if they are inside the 1954 Act. Some should be able to achieve early access to fit-out space under license or agreement for lease.

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