You're blaming our current woes solely on bankers, and excluding all blame from landlords who overpaid for property.
I'm also amused that you have no sympathy for retailers who overpaid for their leases (fair enough), yet have sympathy for landlords who overpaid for property.
And who gave the landlords the money -- Eh the bankers working on dicky valuations.
If a landlord goes bang the Bank take the property, the family home and all and sundry.
So I suppose you think this is amusing. Mad and Sad
Retail Ireland, the IBEC group that represents the Irish retail sector, today called on the Government to change the law on leases to suit the economic climate.
It said that an urgent response is required from all stakeholders in the retail property sector to address the difficult trading situation faced by retailers.
"In view of the current economic climate, Retail Ireland calls on Government to reform legislation on retailer's leases. Arbitrators' hands are tied by the terms of leases that are unsuited to the current extraordinary situation," Retail Ireland director Torlach Denihan said.
"To save jobs and keep as many otherwise viable and well run retail businesses open, arbitrators should be mandated by law to take account of prevailing economic and commercial conditions when reviewing rents," he said.
"When seeking a comparison-based upward rent review, a landlord should be obliged to give all material information to the arbitrator. Where an increase being sought is justified by a higher rent contained in a lease with another tenant, the landlord should be obliged to provide a comprehensive picture of his relationship with that latter tenant. Under the current process, landlord's are not obliged to divulge if a separate deal exists with the latter tenant that gives a major discount on the rent amount contained in the lease. Both the arbitrator and the tenant facing the rent review remain in ignorance of the real situation, and the incomplete information given to the arbitrator will probably lead to a misguided conclusion that a rent increase is justified," he aded.
"The arbitrator should be empowered to insert a break clause into a lease where a tenant's business has deteriorated due to circumstances outside the tenant's control. The arbitrator should be empowered to form a judgement as to the reasons for the deterioration of the business with reference to prevailing economic and commercial circumstances. Break clauses were general practice before the boom years, but some landlords refused to provide them when times were good. It should be mandatory that they be contained in all new leases."
"New thinking was shown by the Supreme Court last December in the Linen Supply of Ireland case when it allowed the examiner to repudiate leases as part of a rescue package because previous arrangements were not working. New thinking is similarly required with regard to comparison-based upward-only rent review clauses in existing leases because they are not working in the current circumstances. New mechanisms are needed so that rent reviews and arbitrations take account of an individual tenant's circumstances. Government should build on the Minister for Justice's decision to abolish upward-only review clauses in new leases by reviewing how best to replace them in existing leases by more suitable mechanisms such as turnover-related reviews."
Can you tell me a single instance of where someone also lost their family home? This is not standard practise.
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I don't know anything on their background so can't comment, merely that they are now a representative body.Personally I find that some of the changes which are been requested are very very off the planet. My opinion is that REI are a bunch of leeches, scratching the bottom simply to make an influence on the entire sector. Some of the Board members are very questionable in their past actions. The high property prices didn't stop some of them from jumping into the market at the very top. Even more interesting the product that are sold by some of them make it a real reason for consumers to travel North to purchase items at vastly discounted prices.
Actually this is incorrect. As the highlighted sections of the article mentions, and which I alluded to in earlier posts, many tenants WERE forced into paying crazy prices.As mentioned earlier nobody forced some of the retail tenants to pay vastly inflated rents just to get a pitch. Now things have got bad they want to run and run and make the landlords suffer.
Actually this is incorrect. As the highlighted sections of the article mentions, and which I alluded to in earlier posts, many landlords WERE forced into paying crazy prices.
This was the norm.
- At review landlord hikes rent by astronomical number.
- Tenant disagrees.
- Case goes to arbitration.
- At arbitration landlord produces lease indicating another tenant is paying a similar rate and as such it is now the market rate.
- Arbitrator finds in favour of landlord.
- Landlord gives discount to other tenant.
The case is obviously different for newer entrants to the market but that doesn't mean the process isn't inherantly flawed and as such needs radical reform. Most of the points raised by REI relate solely to transparency on what was a completely opaque process.
The price was a fake price which was immediately repaid as a discount or rebate to the third party tenant. Did you read the section I highlighted in the REI article?
I'm telling you it's correct. I personally know of 3 instances of this practice independantly of the REI report. I've detailed the consequences in the earlier posts in the thread - to which no one gave much of a viable alternative bar shugging the shoulders and going "oh well".
They paid the increased rent. What else could they do?Howitzer
This is a very serious matter. What did the tenants who were subject to this fraud do?
Isn't that what REI, their representative body, are doing?If they went public on this, then commercial tenants would have a much stronger case.
Again, as the REI report states, all they're looking for is transparency. The falsified nature of the other leases wasn't apparant, or provable, under the exiting arbitration process.I am aware of one case where the rent review, about 5 years ago, seemed mad. Apparently, the arbitrator was "well known for favouring the landlord". So I asked the retailer, why this particular arbitrator was selected by his advisor if he was so well known. Why did they not select an arbitrator known to be biased in favour of the tenant?
They paid the increased rent. What else could they do?
I don't know why one arbitrator was chosen over another, my guess would be one of limited choice in the matter.
And again, I'm not saying the Arbitrator is biased. Merely that the system lends itself to manipulation by one party. Ultimately the tenant is bound to the lease unless a break clause can be inserted - which again again is what REI suggest.It remains as to the discretion of both valuers to AGREE and choose an Arbritrator. If this is not possible, the IAVI appoint one without any conflict of interest.
At arbitration landlord produces lease indicating another tenant is paying a similar rate and as such it is now the market rate.
Arbitrator finds in favour of landlord.
Landlord gives discount to other tenant.
"When seeking a comparison-based upward rent review, a landlord should be obliged to give all material information to the arbitrator. Where an increase being sought is justified by a higher rent contained in a lease with another tenant, the landlord should be obliged to provide a comprehensive picture of his relationship with that latter tenant. Under the current process, landlord's are not obliged to divulge if a separate deal exists with the latter tenant that gives a major discount on the rent amount contained in the lease. Both the arbitrator and the tenant facing the rent review remain in ignorance of the real situation, and the incomplete information given to the arbitrator will probably lead to a misguided conclusion that a rent increase is justified," he aded.
At arbitration can a tenant produce another similar lease with a lower rent than the one the landlord produces at the higher rate?
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