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COVID-19 Update: Commercial Properties and Businesses

COVID-19 Update: Commercial Properties and Businesses

With unprecedented times ahead for everyone, please do keep safe and look after yourselves, your close family and your elderly relatives as best as possible. So far, we have given you updates on how COVID-19 is affecting those with residential properties, but what about commercial premises? I have been speaking to the business banks about their COVID-19 responses and can now share with you an update on how COVID-19 is affecting the commercial property world.

Following the recent government and Bank of England announcements, there has been extremely high demand on banks’ Relationship Directors. One leisure lender has had over 234 calls in the last week alone, with clients concerned about cancellations of bookings, cash-flow issues and particularly how their staff can be paid! There are many questions and challenges facing businesses since the government announcement and social distancing restrictions have come into force. 

It is business as usual for Mortgages for Business and in these challenging times I wanted to keep you updated on our markets.
Yesterday, Bank base rate was cut to 0.10%... the lowest in history. The chancellor Rishi Sunak is using all his financial instruments available to keep the economy moving to keep the economy in the best health possible for when we rid the UK of Coronavirus. He maintains that he will do everything in his powers.

The MFB commercial team have recently had a small number of clients pull out of transactions. We are experiencing this particularly in the leisure-related sectors: including guest houses and holiday lets, and the pub and restaurant sector is also presenting challenges to purchase, with some businesses having to close.

Opportunity knocks

Looking back at the last financial crash of 2008, believe it or not this was a boom time for some of my clients, who picked up some bargain businesses. However, some of these clients couldn’t get finance when they needed it the most! When times are tough, you may not be able to rely on existing lenders to provide the cash-flow; some of you might not have direct access to business managers for example.

Please also bear in mind that in adversity, opportunities arise. You will always find examples where a vendor who needs to sell, chains that break down or the three D’s (debt, disease, divorce), which means the market still needs to turn and this can create opportunities for the brave. If you feel the need to research opportunity over the next 3-4 months chat to your estate agency and business transfer contacts, who will tell you in record time where the opportunities could sit. Above all, maintaining a “business as usual” approach is good for the mind and will provide positive boosts!

If you need finance quickly, then please do give me a call. Our commercial team know of who to go to for a speedy turnaround and to solve any immediate cash-flow issue you might have. 


Lenders are still awaiting final details of the Coronavirus Business Interruption Loan Scheme and how this will work. They are working with UK Finance, HM Treasury and the British Business Bank to deliver the solution. Once they have these details, they will get these out to us immediately so we can start liaising with our clients on how to access the funds. Below is a brief summary of what has being made available by the Chancellor, Rishi Sunak:

  • • A new, temporary, Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will launch imminently to support businesses to access bank lending and overdrafts. The Government will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give lenders the ability to provide finance to SME’s. Once we have the full details of the scheme, we’ll get this out to you. 
  • Grants of up to £25,000 will be made available to hospitality, retail and leisure businesses and small companies occupying business premises with a rateable value of between £15,000 & £51,000. The Department of Business, Energy & Industrial Strategy will be writing to local authorities this week to outline the scheme. Local Authorities should be contacting businesses proactively about funding rather than companies having to apply. 
  • Small businesses that currently pay ‘little or no rates’ will be eligible for a one-off Coronavirus grant worth up to £10,000 (up from £3,000 announced in the March budget). Again, the Department for Business, Energy & Industrial Strategy will be writing to local authorities to outline the scheme and businesses will be contacted proactively rather than having to apply. 
  • Britain’s smallest 700,000 businesses - across all sectors of the economy - will also be eligible for grants up to £10,000. As yet, there are no further details of eligibility criteria. 
  • Business Rates Support: The Business Rates retail discounting in England is being increased to 100% for the 2020/2021 tax year for properties below £51,000 rateable value. The relief will also be expanded to the hospitality and leisure sectors in response to COVID-19. 
    Companies & self-employed individuals in financial distress and with outstanding tax liabilities may be able to agree bespoke Time to Pay arrangements with HMRC. HMRC’s dedicated helpline to call is 0800 0159 559 

    Finally, we want to reassure you that we are open for business as usual and nothing has changed from that perspective. As always, please pick up the phone to 0345 345 6788.