BPF and Law Commission comment on draft Commonhold and Leasehold Reform Bill
The British Property Federation (BPF) has responded to the draft Commonhold and Leasehold Reform Bill, expressing concerns that proposed ground rent caps could adversely affect investments made by pension funds and institutional investors. The BPF stated that investors who acted in good faith to meet pension liabilities should be fairly compensated, noting that this issue is not addressed in current government announcements. While supporting aspects of the proposed commonhold reforms, including changes to major works funding, the BPF said that plans to abolish forfeiture and introduce a new statutory lease enforcement scheme are sensible but require further scrutiny. It also emphasised that the introduction of commonhold must be carefully phased to allow market participants, including conveyancers, lenders and managing agents, to adapt. The BPF added that it is keen to work with the government as the Bill progresses through Parliament to minimise unnecessary economic harm. The Law Commission has welcomed the proposed implementation of recommendations from its work on commonhold and termination of tenancies and said it looks forward to monitoring the draft Bill’s progress through the legislative process.