BRC Calls For Fairer Retail Property Rates

Kevin Hawkins, director general of the British Retail Consortium, has called for a 'fairer balance' in the relationship between the property industry and retailers, suggesting that sales turnover would offer a fairer basis for rental negotiations. In a speech at retail property organisation BCSC's 2004 Conference & Retail Showcase in Manchester, Hawkins, director general of the BRC since April, called into question the relationship which exists between retailers and the property industry.

He warned the 1,900 delegates attending the conference on retail and shopping centre destinations that time was 'running out' for inflexible commercial leases - particularly upward-only rent reviews. He added that the industry has 'one last chance' to make its voluntary code on commercial leases, created in 1995, work. Hawkins said: "Where rent reviews still exist, 99 per cent are upward-only. The government clearly isn't happy with the status quo, although whether, as some property investors believe, Ministers 'have got it in for the property industry', seems a bit far-fetched."

Adding that most BRC members aren't happy with the status quo either, Hawkins said that the organisation's own survey of 61 companies representing one-third of all retail sales in the UK, was fairly indicative of the problems. "In the past 12 months only 22 per cent had successfully negotiated flexible leases in line with the code of practice. The perception among many retailers, large and small, is that they carry a disproportionate share of the investment risk."

"If the property industry seriously wants a partnership with the retail industry - and I believe at least some of its members do - then we need a fairer balance between the two."