Taxpayers could subsidize rental costs for “abandoned” shops and restaurants in the recession of the pandemic on plans “seriously considered” by ministers as tensions rise between landowners and businesses in difficulty.
The government is in detailed talks on a proposal known as a “space grant scheme”, with officials who summoned industry leaders last week to help prepare a bailout plan.
Commercial property owners are likely to lose billions of pounds on the next key payment date in June. The space escape scheme under discussion is modeled on a similar plan successfully introduced in Denmark.
The tenants would have contributed some rents, the owners would have accepted a reduction in payments and the Treasury would have contributed money to fill the gap.
The partnership’s approach could focus on the hardest hit sectors, such as retail and leisure, and be a supportive “escalator”, sources said.
Melanie Leech, CEO of the British Property Federation, the largest real estate agency, said: “The government is taking it seriously. The conversation is about how to best fill that void rather than not recognizing that there is a void. “