Commercial Rent Arrears Recovery (CRAR)
Commercial landlords face many challenges, not least that while managing their property, they may be faced with tenants who have unpaid rent arrears. If this is the case, then our solicitors are on hand to help you obtain any overdue rent and regain control.
In commercial tenancy arrangements, a specific recovery process exists which enables recovery of arrears through enforcement action. This is the Commercial Rent Arrears Recovery (CRAR) process.
When a commercial tenant cannot pay their rent, there are various options available to the landlord to recover the arrears. The landlord must consider what they want to achieve in the circumstances and our experts can help advise you on the best course of action.
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Contact us today for more information about our Commercial Rent Arrears Recovery service. Simply call us on 0345 901 0445 or complete our online enquiry form and a member of the team will give you a call back as soon as possible.
What is CRAR?
Commercial Rent Arrears Recovery legislation is a way in which landlords of commercial properties can recover outstanding debts from their tenants, however, CRAR cannot be used unless an amount equal to 189 days’ rent is overdue.
CRAR is a complex process which includes the requirement to serve prior notice of seven days to the tenant before any goods are seized. Enforcement agents are usually tasked with taking control of a tenant’s assets to sell them to effect recovery of an equal value to the rent arrears.
This can cause significant problems for landlords, as this notice period gives tenants an opportunity to put the goods out of reach.
Speak to our specialist team today and we will let you know your options.
There are three main stages to CRAR as follows:
- The compliance stage – the seven-day letter (enforcement notice) provides notice of arrears and offers the tenant a seven-day period to pay the arrears.
- Enforcement stage – if the tenant fails to pay within the seven-day period, the enforcement officer seeks to take control of tenant property equivalent to the value of the rent owed.
- Disposal stage – after a certain period of times, the seized goods are typically sold at public auction.
It is vital that you seek professional advice as the landlord must follow specific procedures and give the tenant notice. The landlord must also employ an enforcement agent to take control of goods and you cannot do this yourselves.
- Relatively quick
- The tenant remains in place and the relationship can continue
- Particularly effective where the tenant holds valuable goods in the premises
- CRAR can be used against subtenants
- As notice must be given, a tenant may have the opportunity to remove their goods before seizure (unless further court action has been taken)
- Can only be used for rent, not service charges or other unpaid amounts.
Our experienced commercial property and debt recovery solicitors can advise further on the best method of recovering commercial rent arrears.
We provide practical cost-effective advice on a range of commercial property services to help our clients.
How We Can Help
We understand that the recovery of rent arrears can be stressful. Using our experience and wealth of knowledge, we can offer expert advice on all commercial property issues based on your individual requirements.
How to Contact our Commercial Property Solicitors
We are well known across the country and can assist wherever you are based. We also have offices based in Cheshire and London.