Fears are building over gyms and restaurants that may never reopen as landlords threaten them with eviction for unpaid rent during the coronavirus lockdown.
Nearly 3,000 gyms and leisure centres now face the threat of closure, while top chef Yotam Ottolenghi has warned that restaurants are suffering the same issue.
Up to 100,000 jobs could be at risk at gyms with trade body UKActive calling for urgent action to protect places of exercise which remain shut due to the pandemic.
Fresh legislation to protect commercial tenants was brought in last month, but it does not stop landlords forcing them to pay rent withheld due to the lockdown.
An empty gym in Leicester on March 21 after the Government ordered them all to close
Mr Ottolenghi told BBC Radio 4’s programme today: ‘The biggest worry that we have is rent. When corona started and we were asked to close our doors, which is totally understandable because of safety, nobody really addressed the issue of the rents
‘Many, many have not been paying rents. Others have got into arrangements with their landlords, but this has not been solved.
Top chef Yotam Ottolenghi (pictured in May 2018 in London) has warned landlords are threatening restaurants with legal actions
‘Some landlords have been threatening to prosecute and other legal actions against the tenants at restaurants in such a time because they are not paying their rents, and landlords, many of them, rely on the rent to pay their own debts.’
He is calling on the Government to give restaurants a ‘litigation ceasefire’ with a debt enforcement moratorium for six months in which credit action is banned.
Mr Ottolenghi said this would mean business owners cannot be litigated against to pay rent – and the same for landlords who can’t pay their mortgages.
He has also suggested a ‘national timeout’ of nine months rent free from April to December in which landlords would also be compensated.
As for the gym industry, UKActive chief executive Huw Edwards has told how taking legal action such as issuing statutory demands and winding up orders was ‘entirely disproportionate’.
Mr Edwards said yesterday: ‘A worrying number have decided to pursue statutory demand notices or winding up orders.
Notices on exercise equipment at a gym in Long Eaton, Derbyshire, notifying customers of social distancing measures on March 20, the day that all gyms in Britain were closed down
‘We need the Government to act now to direct within the Act that landlords cannot do this. With 2,800 gyms at risk of permanent closure, and 100,000 jobs at stake, time is of the essence.’
Section 82 of the Coronavirus Act 2020 introduced on March 25 intends to help protect commercial tenants by banning the forfeiture of commercial leases until June 30 – or longer if the Government deems necessary – for non-payment of rent.
But it does not stop landlords taking action such as rent arrears recovery, making a debt claim, issuing a statutory demand, or starting winding-up proceedings.
UKActive therefore wants the Government to amend the Act so landlords cannot purse legal action, and introduce financial support for them for a rent holiday.
In one case, David Lloyd Leisure asked a landlord for a waiver of rent due on March 25 until it can reopen its clubs, but the landlord replied by threating legal action.
An outdoor gym which is closed in Leicester, after Prime Minister Boris Johnson put the UK in lockdown to help curb the spread of the coronavirus
The chain’s chief executive Glenn Earlham told BBC News: ‘This situation is unfortunately entirely outside of our control.
‘We want to work together with landlords to ensure we can survive this pandemic and emerge with businesses able to continue to pay rent and other costs in the future.’
And PureGym chief executive Humphrey Cobbold said: ‘Time is of the absolute essence, given that proceedings such as statutory demands and winding up orders threaten to force companies into insolvency within days of being issued.’
MailOnline has contacted the Department for Business, Energy and Industrial Strategy for comment this morning.
Gyms – alongside pubs, restaurants and other businesses – closed to customers from the evening of March 20 under measures introduced by the Prime Minister.
But many promised to freeze membership payments and deliver workouts online.
PureGym, one of the UK’s largest operators with 230 premises, told its more than a million members they will not have to pay while gyms are closed.
A message on its website said it had launched ‘PureGym Home’, bringing workouts, on-demand classes, and ideas for nutrition and well-being, through its app.
When gyms reopen, customers’ first payments will be credited by any outstanding amount from their current monthly subscription, the company said.
Virgin Active also told customers it was automatically freezing membership payments. Accounts will be credited with any frozen fees already paid as well as any pro-rata memberships fees paid for the period between March 21 and 31.
Nuffield Health also said it was freezing fee payments and told customers it would be providing ways to keep them fit and healthy, including through videos on YouTube.
David Lloyd Clubs, The Gym Group, DW Fitness First, Better Leisure Centres and Better Gyms have all confirmed a payment freeze for members covering the closure.