Commercial Rent Arrears Recovery, commonly known as CRAR, is a statutory enforcement procedure available to commercial landlords in England and Wales. It is governed by the Tribunals, Courts and Enforcement Act 2007 and replaced the historic remedy of distress for rent. CRAR allows a landlord to recover unpaid principal rent without first obtaining a court judgment, provided strict legal conditions are met.
CRAR can only be used where there is a written commercial lease and the premises are used solely for commercial purposes. It does not apply to residential leases or mixed use properties unless the commercial and residential parts are clearly separated under different leases.
The process permits a landlord to instruct a certified enforcement agent to attend the tenant’s premises, take control of goods belonging to the tenant, and sell them at auction to recover arrears. However, this is not an informal process. It is tightly regulated and procedural errors can invalidate enforcement or expose landlords to claims.
When Can CRAR Be Used
CRAR is only available for principal rent, VAT on that rent, and interest where the lease provides for it. It cannot be used to recover service charges, insurance premiums, business rates, or other sums, even if the lease describes them as rent.
To use CRAR, there must be at least seven days of net unpaid rent outstanding. The tenant must still be in occupation of the premises. The landlord must instruct a certified enforcement agent, as landlords cannot carry out CRAR personally.
The enforcement agent must give the tenant at least seven clear days’ notice of enforcement before attending the premises. This Notice of Enforcement must comply with statutory requirements and provide the tenant with an opportunity to pay before goods are taken.
If payment is not made, the enforcement agent can attend during prescribed hours, take control of goods owned by the tenant, and secure them for sale. Goods belonging to third parties, tools of the trade up to a statutory value, and essential items are protected.
Because of these restrictions, careful legal assessment is essential before commencing CRAR. Using CRAR incorrectly can expose landlords to claims for unlawful interference or damages.
Strategic Considerations for Landlords
CRAR is only one enforcement option available to commercial landlords. It is not always the most effective remedy. Before proceeding, landlords should assess the tenant’s financial position, the value of goods on site, and the likelihood of recovery.
There are circumstances where alternative remedies may be more appropriate. These can include forfeiture of lease, issuing a statutory demand, or pursuing a debt claim through the courts. Each remedy has commercial and legal implications.
Landlords should consider the following before instructing enforcement agents:
• Whether the arrears relate solely to principal rent
• Whether the tenant remains in occupation
• The estimated value of goods available for seizure
• Whether enforcement could push the tenant into insolvency
• The impact on future rental income and re letting prospects
A strategic approach often yields better results than immediate enforcement. In some cases, structured negotiation or settlement arrangements can recover arrears while preserving the tenancy.
Where a tenant is showing signs of financial distress, landlords must also consider the risk of insolvency proceedings. If a tenant enters administration, enforcement action may be restricted by the statutory moratorium. Acting at the right time is critical.
Why Legal Advice Matters
Commercial Rent Arrears Recovery is technical. Minor procedural errors can invalidate the process. Misidentifying the amount recoverable or failing to comply with notice requirements can expose landlords to significant risk.
Professional advice ensures compliance with statutory rules and helps landlords choose the most commercially effective route. A coordinated strategy may involve reviewing lease terms, assessing enforcement options, and protecting long term investment value.
If you are a landlord facing unpaid commercial rent, early advice allows you to act decisively and lawfully. Delay can limit available remedies and reduce recovery prospects.
Penerley advises commercial landlords across England and Wales on rent recovery, lease enforcement, and strategic dispute resolution. Contact our team today for clear guidance on your enforcement options and a tailored recovery plan designed to protect your investment.
