Rent Relief Update
Governments green light six-month moratorium on evictions
Australian states and territories will put a six-month moratorium on evictions for both residential and commercial tenants during the coronavirus pandemic, Prime Minister Scott Morrison announced tonight.
Tenants and landlords will need to work together
The Prime Minister’s residing message for both commercial and residential landlords and tenants, is to work together to try to come to an arrangement to get them through for the next six months.
“Now there is a lot more work to be done here and my message to tenants, particularly commercial tenants and commercial landlords is a very straight forward one: we need you to sit down, talk to each other and work this out.”
There are many unanswered questions here. But it basically means-
*Rents are postponed rather than forgiven
*Neither law excuses tenants from their liability to pay rent. They merely prevent evictions during the emergency period.
It’s tricky because many businesses are haemorrhaging, and many landlords have mortgage repayments and overhead commitments. So how does one approach this matter with their landlord? Empathy is required more than every by landlords.
The good news is, many landlords understand the dire situation many businesses are now facing. As a result of this landlords are showing signs that they are open to discussions in regard to reducing rents and terms in some form. In short giving tenants rent holidays. At the end of the day, landlords don’t really want to see you go in this climate.
Compromise and finding the middle ground are key!
At Locate Negotiate we are here hear to ease the pain and get commercial tenants a better deal.
It’s time to act now!
Example of Tenant Representation work attributed to Coronavirus undertaken
Alexandria: Warehouse: Rent: $183,000 PA
Outcome: freeze on rent payments for 6 weeks. 25% rent abatement for 12 months.
Fringe CBD: A-grade office - $270,000 PA
Outcome: current 16% incentive to be changed to a 27% incentive over the remaining term of the lease
Newtown: commercial retail shop - $112,000 PA
Outcome: freeze on rent payments for 6 weeks. 19% reduction in the rent until the expiry of the 2nd year of the lease.
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