Guest Blog: Eviction ban set to spread across Europe

By Judi Seebus, Bellier

Robert Jenrick, the UK secretary of state for housing, communities and local government, has pledged that no UK business will be forced out of their premises if they miss a payment in the next three months, London-based real estate trade magazine Property Week reported earlier this week in an online bulletin. “We are providing extra protection for businesses with a ban on eviction for commercial tenants who miss rent payments,” Jenrick was quoted as saying.

Similar measures are being taken in the US as Covid-19 continues to exert a significant drag on the economy, according to law firm Bryan Cave Leighton Paisner. In a note published on Infabode, the London-based real estate information platform, BCLP said last Wednesday there is a growing trend of governmental action to provide temporary protections of possession and tenancies at the national, state and local level. “The government actions vary in form, duration and scope, but will generally delay the course of foreclosure or eviction.” 

In the residential sector, both the UK and US have already taken measures to protect tenants from being evicted from their homes due to payment arrears linked to loss of income as the coronavirus pandemic spreads and leaves many people without a job. A number of continental European countries are following suit. On 26 March, Dutch landlords and the national government agreed to a ban on evictions and an emergency directive will be introduced to extend all temporary rental contracts for residential occupiers.

According to well-informed sources, the German government is likewise preparing emergency legislation to ease the pain of residential occupiers and commercial tenants hit hardest by the coronavirus crisis, in particular retailers outside of the food, medical supplies and other staples segments, restaurant and bars, as well as the leisure and entertainment sector.

While some major landlords are waiting for a legal framework to decide whether they need to take action in this uncharted territory, others have been plotting their own course.

In the Netherlands, for example, Dutch institutional investor Bouwinvest, which manages the market’s largest residential fund, as well as being a major player in the retail, office, logistics and healthcare sectors, did not wait for government action and already communicated a rental payment deferral offer to both its commercial and residential tenants soon after the World Health Organisation (WHO) officially declared the outbreak a pandemic on 11 March. Another major Dutch institutional investor, ASR Real Estate, part of insurer ASR, has taken the same route. And earlier this week in Spain, listed property company Merlin Properties announced it would suspend rent payments for all its retail and hotel occupiers which have been forced to close their doors due to the coronavirus pandemic.

As national governments race to catch up with the fast pace of developments in the wake of the coronavirus pandemic, these companies may in retrospect appear to have been prescient in their course of action. That said, the harsh reality is that many property landlords also require additional reassurance in these times of unprecedented challenges. It is to be hoped that their call for support is also heard by governments across Europe.

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