Coronavirus: Rent-relief refusal puts Perth eatery on the edge

When Jamie Michael and his partner emailed their landlord pleading for a discount on their rent they got a brutal response.

Jay Yin, co-owner of Perth restaurant JJ’s Kitchen which has experienced a sharp fall in business. Picture: Marie Nirme

When Jamie Michael and his partner Jay Yin emailed their landlord pleading for a discount on the rent for their Chinese restaurant premises, they hoped they’d see some of the “Team Australia” spirit Scott Morrison has called for. Instead they got a brief but brutal two-­letter response: “No”.

Now, Mr Michael and Ms Yin may have to close their restaurant, JJ’s Kitchen in Perth’s southeast, after what Mr Michael estimates to be at least a 60 per cent drop in patronage. It’s a story playing across the country as small businesses grapple with the economic shock of the coronavirus.

Small Business Ombudsman Kate Carnell said most landlords had been slow to offer relief to tenants experiencing genuine hardship. “Have there been reductions in rent to accept that a lot of these businesses have been doing it ­really tough? In many cases, no,” she said. “It’s a big concern for the businesses involved. For them to stay open when they’ve got a ­reduction in income, if all their costs haven’t changed, it’s a pretty quick way to go broke.”

Mr Michael said the restaurant had already been feeling the ­impact from the closure of a ­nearby supermarket, which was ­responsible for much of JJ’s foot traffic.

But the headlines about coronavirus sharpened the downturn, and the restaurant is now all but empty on Saturday and Sunday nights.

He had emailed his landlord hoping to start a conversation and was shocked at how ­unequivocal the response had been.

The rejection was all the more galling, he said, because the landlord could see the drop in the restaurant’s earnings, given the rent would automatically increase if the business hit certain earnings milestones.

“We’ve never had a drama, and we haven’t created any drama for those guys. We’ve been a good ­tenant for them for two years,” he said.

Across town, however, Kevin Mattaboni has had a different ­experience. He owns inbound travel agency Travel Forever, as well as Travel Western Australia, which runs tours to The Pinnacles, north of Perth.

The bulk of its customers come from Southeast Asia and China, and he has seen ­demand for his tours more than halve since the outbreak.

The virus emerged just after he had signed a long-term lease to open a second office at London Court in Perth’s CBD, but the landlords agreed to slash the length in light of the outbreak.

“It was supposed to be for five years, but the landlords have said ‘let’s just do it for six months and see how it goes’,” he said. “They were very good.” But with more countries now affected by travel bans, he said he was now hoping to renegotiate for a month-by-month lease.

While state and federal ­governments have singled out the tourism industry for help in the wake of the coronavirus crisis, Mr Mattaboni was sceptical about the ­impact of promoting Australia overseas now.

“There’s absolutely no point putting money into marketing tourism at the moment because people aren’t going to travel anyway,” he said.

“While this is at its peak, and coming into our winter as well, people are not going to be looking at Australia.”