Mumbai: New lease agreements bring ray of hope for many restaurants and bars | Mumbai News – Times of India

MUMBAI: Poco Loco, a resto bar on Khar Danda road famous for its Spanish and Mexican cuisine, will manage to survive even with a little business after lockdown opens partially.
Dilip Datwani, its owner, says the new lease agreement between him and the premises owner has a clause that they won’t be charged rent during the complete lockdown poeriod. And during partial opening a 15% of the business will be shared with the owner, reveals Datwani.
Not Poco Loco alone, the new clause in the lease agreements recently renewed by restaurants and bars with their landlords will help upto 7000 of the approximately 20000 restaurants, bars and eateries across Mumbai to survive the after-effects. Thanks to a section of landlords whose initiative will help not only businesses run but will save jobs for thousands of employees working in them. However, Datwani said another outlet of his daughter on SV Road was to be closed as the landlord insisted on continuing the old agreement.
“Over 50 percent of restaurants remained closed during the first lockdown because they could not continue to pay rents. However, in the second lockdown, many restaurants renewed or signed new agreements with the specific clause that there shall be no rental during the lockdowns. Around 5000-7000 restaurants have benefitted from this new clause. While disputes remain unsettled from the previous lockdown, the new arrangement has resulted in lesser disputes,” reveal Pradip Shetty, senior vice president of hotels and restaurants association western india (HRAWI) and owner of Maharaja restaurants.
Ahar president Shivanand Shetty, who owns Hariyali resto bar in Wadala, said it may take a longer time for recovery of business than earlier anticipated. “Landlords are also facing unpaid rents, as operations were facing frequent disruptions. We believe that almost all existing lease agreements should be reviewed, and mutually agreeable terms may be drawn to tide over the critical period and facilitate continuity of the business entity,” he said pointing out that post first lockdown around 30% of the restaurants in rented premises have not even opened.
“The restaurants were operating at 50 percent capacity which led to disputes between property owners and restaurant owners over the rentals. The night curfew also disrupted restaurants’ operational timings, thereby not allowing restaurants to operate during prime business hours. The disputes are over what the justified rentals should be under such circumstances. Now during the second lockdown, owners are averse to renting their properties to restaurants because they have realized that a restaurant is the first business to be affected when a lockdown is imposed. Secondly, restaurants’ revenues continue to remain sub-par even after the lockdown is lifted because of restrictions on capacity and timings,” revealed Pradip.
It may be mentioned that the Hospitality workforce majorly stands disrupted due to the uncertainty of jobs. A lot of people formally employed in the Hospitality sector have switched or are in the process of switching to other industries that provide better stability of income. All the above issues will have a long-term effect on the restaurant industry and will definitely impede the revival process. Lack of capital, dearth of the workforce, and mounting losses threaten this enormous Tourism and Hospitality Industry which accounted for around 10 percent of the GDP, supported around 90 million jobs, and generated Foreign Exchange Earnings (FEE) to the tune of Rs.1,94,881 crores (US$ 29.96 billion) in 2019.

Source link


View Comments (0)

This website uses cookies.