Rising administrations see landlords scrabble for tenants

The rising number of businesses facing distress and imminent administration may present opportunities for people looking to buy or rescue businesses, but for landlords they are proving to be a costly headache.

Closing retail stores and administrations of high street chains have left UK landlords facing some £393 million in lost rent and increasingly desperate to find new tenants to buy out the leases.

Research published by the Investment Property Databank (IPD) has shown that, out of a total annual income for commercial landlords across the UK of £7.2 billion, the annual loss amounts to some 0.5 per cent.

The landlords have been hardest hit by some of the highest profile administrations, which have left thousands of square feet of prime retail space standing empty across the UK. Some the big names include Oddbins, Focus DIY and Haldanes.

IPD's UK and Ireland client services director, Malcolm Hunt, said the affects of the closures would obviously hit some landlords harder that others, but those facing the worst of it will be scrabbling to fill their spaces.

"Only 16 percent of property funds could lose more than one percent of their income stream as a result of these corporate failures," he pointed out. "The two most important retailers affected are Focus DIY and TJ Hughes with potential total impacts over the lifetime of their leases of up to £231m and £94m respectively."

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