Labour says its plans to abolish upward-only rent reviews could save up to 15,000 retail jobs.
The party today said it would enact legislation to abolish upward-only rent reviews as a priority for all commercial leases. As an interim measure, it would appoint a commercial rents ombudsman to adjudicate on rents that had the potential to cause a business fail.
It says the proposals are a response to the suffering of the retail sector resulting from the “property bias” of Fianna Fáil’s economic policy.
Labour says this has seen revenues plunge after the dramatic collapse of the property bubble, with retailers trapped in upward-only leases while consumer demand stagnates.
“These rents were set at the top of the property bubble, so what you have is boomtime rents and recession-time retail incomes,” said Labour’s retail sector spokesman Ciaran Lynch.
Labour published its proposals at a press conference in Korky’s shoe shop on Dublin’s Grafton Street, where the owner, John Corcoran, said he was paying over €500,000 a year in rent on a 35-year lease with no break.
Mr Corcoran said property owners were destroying jobs through upward-only rent clauses and the banks had contributed to the problem by lending money on the lease rather than the value of the property.
Labour’s justice spokesman Pat Rabbitte pointed out that prime rents increased by 240 per cent between 2000 and 2007, while the consumer price index went up by 30 per cent during this time.
Labour was satisfied that a ban on upward-only rent reviews could be introduced through legislation and a referendum would not be needed, Mr Lynch said.
Best of luck with that, lads. Plenty of institutions will fight that to the death!