Insight

What now for businesses left out in Covid-19 cold?

As more sectors are included in the Covid-19 business rates’ relief schemes those that are still left out face daunting overheads as revenue and income disappear at an alarming rate.

Property Week is reporting that leaders of more than 30 flexible workspace businesses have written to chancellor Rishi Sunak warning hundreds of operators could go under because of declining membership in light of the Covid-19 outbreak. Figures of a 90% drop in business are being touted.

The letter has been signed by 32 operators including Huckletree, Office Space in Town, TechSpace and Uncommon. They are now asking that flexible workspace businesses be included in the 12-month business rates relief being offered to the high street and retail, and recently extended to include the likes of estate agents after industry pleas for help.

The letters states: “Put simply, these companies have been directly impacted by the pandemic much like hospitality businesses. Hundreds of independent co-working spaces will go bust unless the government steps up.

“The very flexibility that had facilitated the growth of entrepreneurship (short, flexible contracts and low rents) are now causing huge problems for the spaces as companies are pulling back. Events space is often a secondary revenue stream that has now been entirely cut off as well.”

Last week Property Week also quoted that serviced operators had seen transactions plummet by around 90% since the beginning of the outbreak.

In a final plea, the operators also asked for public sector landlords to be approached and forgo, not just delay, a significant proportion of rental and service charges, either directly or through a separate government financial intervention.

As Sunak has already extended the business rates relief to other hard-hit industries there are sure to be other smaller, but no less affected, sectors out there which need this stay on their business rates. We will have to wait and see if the flexible work sector is significant enough and therefore successful in its bid for help; or will others take precedent in the Chancellor’s list of priorities.

 

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