Coronavirus rental relief for crippled businesses

Financially crippled businesses will receive rent relief during the coronavirus pandemic under a mandatory code of conduct announced by the Prime Minister.

FINANCIALLY crippled businesses will receive rent relief during the coronavirus pandemic under a mandatory code of conduct announced yesterday by Scott Morrison.

The Prime Minister said rents would be reduced in proportion to the fall in a commercial tenant’s turnover.

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“The point here is simple – it’s the same request we made of landlords and tenants about 10 days ago … and that is that they sit down and they work it out,” he said.

“This must be shared. Banks also must come to the table here and provide the support to the landlords.”

The code, which has been backdated to last Monday and will run for the same period as the JobKeeper program, will apply to commercial tenants with an annual turnover up to $50 million.

“What this does is it preserves the lease, it preserves the relationship, it keeps the tenant in their property and it keeps a tenant on the lease, which is also good for the landlord, and it preserves the lease that is in place that underpins the value of those assets,” he said.

The Federal Government immediately announced it would waive all rents for its small and medium enterprises and not-for-profit tenants across Australia.

Finance Minister Mathias Cormann said any company taking up the rent relief program would have to keep employees in a job through the JobKeeper initiative and provide rent relief to subtenants.

“The Australian Government is acting as a model landlord trying to help our tenants through this period where their activities are impacted by the coronavirus health crisis,” he said.

“This initiative is expected to cost about $7.6 million over a six-month period.”

He also announced the Defence Department would waive all operational charges to the aviation industry.

The rent relief will continue until the Australian Government lifts restrictions in place to slow the spread of COVID-19.