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26 June 2020 | Pubs

Covid-19: Reopening Pubs and Restaurants

On Tuesday 23 June, The Prime Minister announced that pubs and restaurants are allowed to reopen from Saturday 4 July, in England. The announcement that pubs and restaurants have been given the go ahead to reopen was accompanied by guidelines for keeping workers and customers safe. These guidelines allow for operators to reduce the two-metre social distancing rule, to one metre plus where two metres is not viable. 

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The guidelines also make provision for operators to keep a temporary record of their customers for 21 days to assist with NHS ‘Test and Trace’.  It also discourages customers ordering from bars and encourages table service where possible. 

The announcement that pubs and restaurants would be able to reopen is much welcome and provides the sector with certainty over when and how they are to be allowed to assume business. Operators and key stakeholders will now be able to focus on their reopening plans in earnest.

Early signs are that not all operators will open on 4 July, and indeed many operators had prior to the announcement, decided that they would delay or phase in openings. Clearly the way pubs and restaurants will look and feel will be very different from a customer perspective compared to how they operated pre the Coronavirus crisis. It will be interesting to see how customers react once the initial euphoria has died down. It will also be interesting to see how these measures impact on performance of the sector but hopefully with continuation of the warm weather and welcome news from the Prime Minister this will give everybody a much-needed confidence boost.

The announcement came just ahead of the June quarter rent payment date of 24 June. Clearly with pubs and restaurants being closed since 20 March and with no cash coming into the business many tenants have simply not been able to pay rent during this period. This is an issue not just affecting the hospitality sector as it has also affected retail and other sectors, but undoubtedly the hardest hit sectors have been in hospitality and retail.

The Government had enacted a moratorium on forfeiture and associated actions to provide breathing space to the sector alongside other support including guaranteed loans, business rate relief and the Coronavirus Job Retention Scheme (CJRS). The full Coronavirus Act 2020 can be found here.

This moratorium has been extended to the end of September and at the same time a Code of Practice issued for Commercial Property Relations. The Code of Practice provides common sense advice and guidance on how landlords and tenants should engage but makes it clear that tenants who are able to pay rent should do so and whilst those businesses who cannot pay rent should communicate with their landlords and pay what they can.  Landlords should provide full support to businesses if they are able to do so.

The next few months will be a pivotable period for the sector as business and operators reopen and have a clearer picture of what future trading performance might look like. There will be challenges ahead as operators incur costs from bringing businesses out of hibernation alongside further pressures to pay rent and with the tail off of support under the CJRS.

However, what we have learnt over the years is that the sector is, if nothing else, resilient and it is hoped that with continued support of all stakeholders that the majority of pubs and restaurants will be able to successfully trade through this difficult period and come through on the other side.
 
Please get in touch if we can be of any support to your business at this time.

Stephen Owens FRICS MCIArb
Managing Director – Pubs & Restaurants


T  +44 (0) 113 389 2726
M  +44 (0) 796 800 4550
E  stephen.owens@christie.com

 
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