Response to the Pandemic

With the forthcoming release of lockdown restrictions, operators in the hospitality industry will need to continue to adapt their premises to comply with social distancing measures and limitations imposed on the use of indoor spaces. This is leading operators to spread their operations beyond their original premises through the use of ad hoc outdoor seating areas in open spaces, highways and even car park areas.

Given that the risk of contracting Coronavirus is considerably lower outdoors, the availability of outdoor seating space has become an important feature for hospitality venues. Previously, an ‘outdoor seating licence’ was merely an ancillary document to a lease, but the shift in circumstances has meant that it has become a fundamental tool in maximising capacity to serve customers in a safe and effective manner. The right to operate in outdoor spaces will also have a key impact on the viability of many hospitality businesses, especially from 12th April 2021 when (under the current roadmap to lift lockdown measures) restaurants and pubs will only be permitted to serve food and alcohol to customers seated outdoors. Indoor seating at hospitality venues is due to resume from 17th May 2021. However, the need to rely on outdoor seating space will inevitably continue beyond this date.

Considering the Extent of a Premises

Tenants wishing to use outdoor space should carefully consider the extent of the premises demised to them under their existing lease and whether the relevant outdoor area forms part of it. Where the outdoor area is beyond the tenant’s demise, they will need to vary their lease or secure an outdoor seating licence by agreement with their Landlord. A licence is likely to be subject to a licence fee and contain restrictions such as designated hours of use and an obligation to manage customer queues and minimise the impact on neighbouring businesses. Landlords and tenants will also need to consider who will be liable for the repair and insurance (including third party liability) of any additional areas. If tenants intend to erect pods or shelters in the outdoor space, these rights will need to be expressly included in the deed or licence and rights to carry out any alterations that may be necessary.

Any planning permission affecting the outdoor space should also be reviewed to check whether the tenant’s proposed use is restricted or subject to conditions. Tenants should also be mindful of rules relating to any structures which they plan to erect on outdoor spaces. The latest regulations stipulate that any shelter must not be wholly or substantially enclosed, which means that it should not have any sides, including doors or windows (that can be open or shut), which enclose more than 50% of the shelter. Individual councils may interpret the regulations more flexibly than others; therefore, it is important to check local guidance as the shelter may be deemed to be indoor seating.     

Where the outdoor space is owned by a third party such as the local council, tenants will need to negotiate directly with them. Tenants operating with a Premises Licence should also consider whether they are permitted to allow customers to consume alcohol outside of their premises.

Pavement License

Businesses which use premises for the sale of food or drink for consumption (on or off the premises) are also eligible to apply for a pavement licence, which permits them to use furniture placed on the highway to sell or serve food or drink and allow it to be used by people for consumption of food or drink supplied from, or in connection with the use of their premises. To support hospitality businesses during the pandemic, the Government introduced changes to their licencing procedure for properties in England in 2020, which created a quicker and simpler approach to obtaining pavement licences. Any pavement licences granted under these relaxed licencing provisions were originally due to expire on 30th September 2021; however, the Ministry of Housing Communities and Local Government has now extended this date by a further 12 months.

A substantial number of planning laws have also been relaxed to accommodate the hospitality industry, such as the automatic right to provide takeaways and make deliveries which the Government introduced at the start of the pandemic. This is set to continue, as well as the right for pubs to erect marquees without planning permission for up to two months.

Local authorities were also granted the right to use land to hold outdoor markets without applying for planning permission, which has now been extended to March 2022. Additionally, since last year, businesses have had greater flexibility to hold outdoor events such as summer fairs, car-boot sales, or motorsports on land without the need for a planning application. The Government has increased the number of days allowed for such temporary events from 28 to 56 days, and in November 2020, they extended this provision until 31st December 2021.

Overall, a determined effort has been made by the Government to support the hospitality industry’s response to the pandemic, and operators have keenly adopted the relaxed rules in respect of outdoor space. It is likely that such measures will continue to be relevant for the foreseeable future and may become a more permanent feature for hospitality venues.

Here to Help

If you are looking to buy commercial property for conversion to residential use, please contact one of our Real Estate Solicitors on 0161 941 400 or email the Myerson Solicitors Real Estate Team.