Whitbread has asked landlords for a 50% rent reduction for the upcoming three months as Covid-19 continues to impact its trading.
According to the BBC, the hotel owner wrote to landlords suggesting that they should “share some of the pain” experienced during lockdown.
The hotel group had previously announced as many as 6,000 future job cuts as both government restrictions and the continuous impact of Covid-19 has affected the group’s performance overall.
Andrew Jones, chief executive of LondonMetric, a FTSE 250 property company with a Premier Inn tenant, told the BBC: “Whitbread has behaved impeccably towards landlords and so we will look to help them with their cash flow whilst the business recovers.
“A permanent transfer of value from our shareholders to theirs is not appropriate for a company still valued at over £6bn. There are no contractual provisions for landlords to share gains in the good years and so sharing pain in the tough years seems inequitable. After all, you can’t un-sign a contract.”
A Whitbread spokesperson also told the BBC that throughout the pandemic to date, the company has paid its rent commitments in full, even when the hotels and restaurants were forced to close.
They said: “With ongoing government restrictions expected to result in subdued market demand into the first half of 2021, we are now asking our landlords to support us, as other stakeholders have during the pandemic, through a reduction in rent for the December quarter in recognition of the current environment.”
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