Monday, March 14, 2011

Two sides of the argument re Banning upward-only rent reviews - The Irish Times - Mon, Mar 14, 2011

Madam, – Recent articles by Bill Nowlan and Ann Hargaden (Commercial Property) regarding rent review proposals are to be commended. One would hope our new Government will take heed of them.

If we are to bring any stability and activity back to our virtually dormant investment property market, it is essential that the madcap notion that insolvent commercial tenants will be able to have rent reductions foisted onto unwilling landlords be knocked on the head very quickly.

Otherwise Nama will never be able to unload the billions of euro of property it now has on its hands, and property values in Ireland will continue to stagnate for many years to come.

No foreign investor in their right mind would consider investing here while such a threat looms and as your correspondents have correctly pointed out, the rental markets, given time, will find their own level, without further governmental interference, or ill-thought-out suggestions.

Landlord and tenant legislation has evolved over hundreds of years, and it would be most unwise to wish to change it, unless absolutely necessary. – Yours, etc,



Dublin Land Securities Ltd,

Mespil Road,

Dublin 4.

Madam, – Ann Hargaden, Lisney director, makes a number of debatable points in her article (Commercial Property, March 9th) which essentially argues against the revoking of upward- only rent reviews on commercial properties.

Ms Hargaden states that if a property’s rent were to be reduced by 30 per cent then the landlord would effectively lose 100 per cent of his initial capital invested. Of my six leased properties, five have been in the possession of the current landlords in excess of 15 years and so this loss of capital would not apply as assumed.

Ms Hargaden contends that “most tenants will not have had a rent review at the very peak of the market and the vast majority will have had a lease break option since the downturn commenced”. Five out of six of our leases were settled at the height of the boom and none have lease break options.

Finally we are told that “the idea that a landlord would willingly allow a tenant to become insolvent and leave himself without income to meet his loan repayments is ludicrous”. This shows that Ms Hardagen must be writing about a world where dreams and reality have become distorted. If she would like a list of such realities then I’m sure that David Fitzsimons of Retail Excellence Ireland would only be too obliged to supply a long list of such cases. – Yours, etc,



Wicklow Street,

Dublin 2.

The words "Rock" and "Hard Place" seem most apt...

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