Since the government ordered the closure of most on-trade premises to prevent the spread of COVID-19 last month, the UK hospitality industry has come to a halt.
Despite the government imposing financial support for the industry through a job retention scheme and a three-month rent forfeiture moratorium, Downey believes the UK needs a period of nine months rent free for pubs, bars and restaurants in order to prevent the permanent closure of thousands of venues nationwide.
Downey, who also owns Street Feast venues across London, said: “I think the next best measure is a National Time Out where the next nine months until December 31 are rent free for any hospitality business. In order to make that work with landlords, we need to make sure they get a debt repayment break so that they’re not repaying any loans for nine months which they’ve taken out on properties that they’re not getting rent from.”
To make up for this period of rent-free, each corresponding lease is extended by 9mths - those payments aren't lost, just postponed. To help landlords manage the loss of income, we do the same push back for them on the next 9mths of their loan repayments.*
— Jonathan Downey (@DowneyJD) April 9, 2020
Downey has been in contact with more than 2,000 business owners and senior operators to come up with solutions to the crisis and his #NationalTimeOut hashtag is gaining momentum on Twitter.
Downey added: “The nine months which are rent free will be added onto the end of the current lease, and the nine months of landlords not repaying loans will get added to their current loan deals.
“This National Time Out won’t cost the government anything. They spent £40bn on the job retention scheme, which was far more successful than what they’d planned for, and that gets us to the end of May.
“But if they don’t extend it beyond then, two million people will lose their jobs - and there’s only so much money the government can throw at the situation. But this scheme won’t cost them anything, it’ll just push things back nine months and nobody loses out.”
Downey’s Street Feast company has four London venues including Dinerama in Shoreditch.
“I think most businesses in hospitality aren’t going to be open for the next six months, I certainly won’t be with Dinerama and our other spaces.
“Maybe under 50 capacity venues could open up in July or August but anything bigger than that, forget it. And even when they can open they’re going to be running at least 30% down, we’d lose money if we reopened before then.”
