- Day one figures provide an indication for the remainder of the quarter
- Initial rent collection is +3.9% compared to June quarter day
- Retail properties continue to be the hardest hit collecting just 12.7% of rent due, a 1% decline compared to June quarter day
- Offices emerge the most resilient asset type, collecting 31.8% of rent due, a 9% improvement on June quarter day
Re-Leased, the cloud-based commercial property management platform, has revealed that landlords collected 22.1% of commercial rents due on 29th September, this quarters’ rent day, marking a positive improvement on the June quarter day.
Yesterday’s initial figure compares with the 25.3% and 18.2% of rent that was collected on the March and June quarter days, respectively. The rent collection curve improved considerably for both previous quarters, with around two-thirds of rent collected 60-days after due date.
Retail properties continue to be the hardest hit and collected just 12.7% of rents due, down on the 13.8% that was collected on June quarter day. Retail was the only sector to see rent collection decrease on the previous quarter, with offices and industrial assets both seeing improvement.
Re-Leased’s analysis is based on live rental collection data from over 10,000 commercial properties and 35,000 leases on its UK platform.
|
Total % of rent collected
(as of day 60)
|
Mar Qtr 2019
|
Jun Qtr 2020
|
Sept Qtr 2020
|
|
UK – all commercial*
|
25.3%
|
18.2%
|
22.1%
|
|
Retail
|
19.8%
|
13.8%
|
12.7%
|
|
Office
|
31.2%
|
22.8%
|
31.8%
|
|
Industrial
|
23.0%
|
16.2%
|
18.3%
|
Tom Wallace, Re-Leased’s CEO, said “To see overall rent collection improve on the last quarter day is reassuring, especially following the new restrictions for businesses announced by the government last week and the recent extension of the rent moratorium. While there remains uncertainty in the market over rising coronavirus cases and the possibility of further restrictions, initial signs suggest the rent collection curve over the next 60 days will be on par with March and June.”
“These figures will however be very concerning for retail landlords with rent receipts continuing to decline. Retailers are trading in the toughest of circumstances but those who are well-capitalised
and can pay some or part of their rent should. Landlords now face huge financial pressure on meeting their own debt obligations.”
The British Property Federation estimates total rent unpaid for UK commercial property between late March and the end of December will be around £4.5 billion.
Caleb Dunn, commercial analyst at Re-Leased, said: “The general theme of improvement in rent collection that we have seen this quarter is testament to the ongoing efforts by landlords and agents to sustain relationships with their occupiers during a volatile period. As a large number of businesses confirm their long-term back to work plans, a greater degree of certainty is reflected in the boost of office rent collections.”
Behind the national picture, there are significant variations in rent collection across the country. A breakdown of the UK’s 10 regions reveals the West Midlands is the most resilient region, while the North East is the least resilient. London ranks 5th, collecting 20.2% of rent, slightly below the UK average.
|
Total % of rent collected
(as of day 60)
|
Mar Qtr 2019
|
Jun Qtr 2020
|
Sept Qtr 2020
|
|
East of England
|
30.40%
|
13.30%
|
26.00%
|
|
Wales
|
16.40%
|
14.40%
|
24.70%
|
|
East Midlands
|
25.90%
|
17.80%
|
23.40%
|
|
London
|
21.10%
|
25.30%
|
20.20%
|
|
Yorkshire And Humber
|
23.00%
|
17.70%
|
20.10%
|
|
South East
|
26.90%
|
24.80%
|
19.80%
|
|
North West
|
26.00%
|
19.40%
|
18.80%
|
|
South West
|
19.40%
|
15.20%
|
17.10%
|
|
North East
|
36.30%
|
19.20%
|
13.40%
|
About Re-Leased
Founded in 2013, Re-Leased is a modern cloud-based, commercial property management platform which centralises portfolio data, automates workflows, and provides live visibility for landlords, property managers, tenants, and accountants. Re-Leased now manages over 70,000 properties worldwide, including 35,000 commercial leases in the UK.
About CREDIA
CREDIA is a property intelligence platform which combines Re-Leased’s global real estate knowledge and data capabilities to improve decision making through a suite of four online products.
The CREDIA Index is a free to use monthly index launched in 2020 and is updated every month. It draws on Re-Leased’s extensive live, anonymised and aggregated datasets to provide insights into key trends and performance measures for the commercial real estate market.
To learn more, visit www.crediahq.com and www.re-leased.com
