A licensee has applied to Greene King to trigger a free-of-tie rent review — the market rent only (MRO) option — as a result of the adverse effect of covid.
The licensee in question is Pubs Code campaigner Gary Murphy, of Ye Olde Mitre Inne, Barnet, who also happends to be Pubs Code adjudicator liaison officer for the Campaign for Pubs, and a leading campaigner on the Pubs Code and tenants’ rights.
His application to trigger MRO follows a letter from the Campaign for Pubs sent to the Pubs Code adjudicator (PCA), Fiona Dickie challenging the announcement from the PCA that she has approved the declaration by the regulated pubcos which excuses them from abiding by statutory Pubs Code deadlines during the lockdown of England only. The Campaign for Pubs does not believe that the PCA has the power to authorise the suspension of statute in this way.
The Campaign for Pubs believes that the different lockdowns and restrictions in England and Wales now allow all tied pub tenants who will be affected by a downturn in trade to trigger a free-of-tie rent review — the MRO option Ms. Dickie previously advised that the MRO could not be triggered for the original lockdown because it applied to all pubs in England and Wales.
The campaign says that the fact that there is now divergence between England and Wales, and the tier system causing further divergence in England, means that these different events should, according to the wording of the Pubs Code, be triggers for an MRO option, the right to go free of tie, and to seek an independent rent assessment.
The biggest issue for many pub tenants has been the levels of rent pubcos and other landlords have charged, together with hugely inflated prices for beer.
The problems tenants face due to the beer tie and pubco model was powerfully highlighted this week in the first episode of Saving Britain’s Pubs, on BBC Two, presented by Tom Kerridge and featuring Campaign for Pubs director, Greg Mulholland, who originally pushed the MRO legislation through Parliament.
‘We hope that the Pubs Code adjudicator will stand up for tenants’ rights’
The campaign has been calling for an independent rent review for all pub tenants as covid trading conditions mean that normal rent levels cannot be justified and must be reviewed.
Gary said: ““The case for triggering MRO now as a result of localised restrictions would seem very strong. I would encourage every tied tenant to look at their situation and to commence the process with their pub company as soon as possible.
“I have to wait 28 days to know whether Greene King will contest [my] trigger, but it is very clear that my trade is massively impacted for the foreseeable future and I would hope that Greene King and the PCA do not resist the obvious need for a rent review.”
Greg Mulholland added: “We commend Gary Murphy of Ye Olde Mitre for once again showing the way for tenants of the regulated pubcos, and seeking to trigger the market rent only option.
“The different circumstances in different parts of England and in Wales must surely mean that all tenants of the regulated companies have the right to trigger the market rent only option. We hope that the Pubs Code Adjudicator will stand up for tenants’ rights and confirm this.
“We also believe that the government must wake up to the national rent crisis faced by many pubs and other businesses, and instead of useless voluntary codes, bring in a statutory rent review for all tenants.”