Mainly, why is this only a short-term relief? Prupim’s point that the key is to get the relief to retailers as soon as possible is certainly true, but why only allowing monthly rents for a year will make administrating the switch any quicker is less than clear.
What retailers want is to know that landlords are changing their attitudes, not offering a lifeline today and cutting the rope tomorrow.
But there is no doubt that Prupim has done more than many of the institutional landlords, which still refuse to state their position, or make it clear that any concession on payment terms will have to be met with higher rents.
When Hermes announced last September that it was offering monthly rents on existing leases, the initial reaction was that finally the revolution had begun. But retailers soon discovered the extra 1 per cent rent they could be paying to enjoy the privilege.
Retailers quite rightly feel that paying rent monthly should be an industry norm, not a momentary privilege or a reason for more cost.
The argument of many landlords that still impose financial penalties to retailers that choose to go monthly is that there have been only a small number of tenants actually asking for the switch. When it is so hard to see the financial benefits because they have been diluted by the conditions of the deal, is this so surprising?
Prupim has done the right thing, and we hope that more landlords will be equally imaginative.
But it is still a concession with strings attached, and remains to be seen how attractive an offer it really is.