Rent Abatement

In December 2011, NAMA introduced a rent abatement initiative to deal with cases where commercial tenants of its debtors can demonstrate that the rents payable under their current leases are in excess of market levels and, as a result, that the viability of their businesses is threatened.

To date, NAMA has approved rent abatements with an annual aggregate value in excess of €24.5 million and long-term rent reliefs, including in a number of Examinership cases, worth over €40 million over the life-time of the related leases.  The aggregate value of abatements agreed to date is the rent due to NAMA that it has agreed to forego in order to help businesses to survive.

The objective of agreeing rent abatements in the first instance is to support the short-term viability of small and medium businesses around the country which are intrinsically viable but which are experiencing difficulties arising from current economic conditions.

Facts & Figures

  • Rent abatements with an annual aggregate value in excess of €24.5 million
  • Working with debtors & receivers to help retail SME’s
  • Over €40 million in long term rent relief

In cases where there is genuine hardship which can be ameliorated by rent abatement, NAMA achieves two significant benefits. Firstly, it helps to preserve the value of the collateral supporting NAMA loans by ensuring that tenants remain in business and continue thereby to generate rental income. Secondly, it safeguards jobs and economic activity in general. Any short-term loss of rental income arising from rent abatement is likely to be more than offset by these long-term benefits. The terms of NAMA’s Guidance Note on Upwards Only Commercial Leases are not designed to confer benefits on businesses that are trading profitably or are part of trading groups that are in a position to honour their current contractual arrangements on rent.

Guidance Note on Upward Only Rent Reviews