Commercial Rent Relief Delivers Mixed Results
St. John’s, NL
- The St. John’s Board of Trade is very pleased that the Government of Canada has introduced a program for commercial rent relief. But the Board has concerns.
“This program will put money in the hands of businesses that need it the most. However, it will exclude many businesses who have been working to keep their doors open.” – said Andrew Wadden, Chair of the St. John’s Board of Trade.
“The revenue loss threshold of 70% should be decreased as it is far too high for many businesses. The program is also problematic for landlords as they will be expected to decrease their rent by 25%. If they are unable to decrease the rent, then the tenant is left out in the cold and will be excluded from rent relief. We hope that Government will be open to improving this program to better assist both commercial tenants and landlords.”
The Board will continue to talk to members about possible solutions to improving this program. If you have feedback, we want to hear from you. Please visit stjohnsbot.ca.
Details on commercial rent relief program:
- The program will provide forgivable loans to qualifying commercial property owners to cover 50 per cent of three monthly rent payments that are payable by eligible small business tenants who are experiencing financial hardship during April, May, and June.
- The loans will be forgiven if the mortgaged property owner agrees to reduce the eligible small business tenants’ rent by at least 75 per cent for the three corresponding months under a rent forgiveness agreement, which will include a term not to evict the tenant while the agreement is in place. The small business tenant would cover the remainder, up to 25 per cent of the rent.
- Impacted small business tenants are businesses paying less than $50,000 per month in rent and who have temporarily ceased operations or have experienced at least a 70 per cent drop in pre-COVID-19 revenues. This support will also be available to non-profit and charitable organizations.