Managing residential tenanted property can be a challenge for receivers. In many cases, it is necessary for them to act as “accidental landlords” to maximise the potential realisations to the appointing lender. These lenders have lent money to companies or individuals who invest in residential blocks and collect rents from their tenants. When the borrowers default, the lenders appoint receivers to collect the rents and ultimately sell the blocks of flats. It sounds straightforward but dealing with numbers of individual tenants and knowing the statutory regime which regulates residential lettings can be a minefield for the unprepared.
Mark Prior has written an article looking at five key considerations that a receiver needs to be aware of when asked to manage residential tenanted property: (i) his or her powers; (ii) understanding the occupational arrangements; (iii) collecting rent and other monies from the tenant; (iv) understanding the actual property itself; and (v) the impact of the changing statutory regime.
The article first appeared in Corporate Rescue and Insolvency February 2017 edition. Tenant troubles -a minefield for the receiver