LANDLORDS are increasing commercial rent rates to make their properties appear more valuable before they enter the NAMA process, the Labour Party claimed.
Spokesperson on local government, Ciarán Lynch, claimed the Government’s plan to take over bad loans from banks is forcing shops and other businesses to pay higher rents instead of helping them by making credit more available.
The Labour Party is calling for a ban of upward-only rent reviews, which it said are leading to a number of shops and retailers going out of business and thousands of jobs being lost.
Last summer, the law was changed to allow downward rent reviews for new leases negotiated on or after March 1 this year. But Taoiseach, Brian Cowen, told the Dáil yesterday it is "not constitutionally valid" to interfere in contracts made before that date.
"The advice received from the office of the Attorney General is that real legal and constitutional difficulties would arise if property rights were to be effected retrospectively," he said.
Labour has received legal advice contrary to this and accused the Taoiseach of wrapping himself in the constitution to protect developers.
"You didn’t seem to have any constitutional difficulty when you decided to set up NAMA, you didn’t have any constitutional difficulty when you decided to revise unilaterally the contracts of the employees of the state last year when you decided to cut their pay," Labour leader Eamon Gilmore told the Taoiseach during Leaders’ Questions.
"You suddenly wrap yourself in the constitution when it comes to protecting the interest of landlords and some of these very property developers that have landed us in this difficulty in the first place," he said.
Shop owners were locked into these leases which were negotiated during the Celtic Tiger years, according to Mr Gilmore. "Their arms were twisted by property developers to sign up to leases with very high rents and now they and now they are being told that those leases cannot be revised downwards," he said.
"In every shopping street in the country, retail businesses are pushed to the wall, trying to get costs down, trying to survive and trying to keep people in employment," he said.
Mr Lynch said a bill he proposed in the Dáil last night to ban upward only reviews would "offer a lifeline to struggling businesses" who he said were being forced to pay "penal levels of rent".
a d v e r t i s e m e n t
This appeared in the printed version of the Irish Examiner Wednesday, March 10, 2010
