12 May 2020

ACT stumps up $25 million to help commercial landlords and tenants survive downturn

| Ian Bushnell
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Chief Minister Andrew Barr

Chief Minister Andrew Barr said commercial landlords will have to ensure they are doing everything they can to help businesses survive. Photo: File.

The ACT Government is dangling the promised carrot of rates relief to commercial landlords if they give their tenants a break during the COVID-19 crisis.

It has announced a $25 million, six-month program that offers rental and rates relief for tenants and landlords.

The announcement comes a day after the Canberra Liberals called on the Government to let businesses know when they would receive help with their rates.

”It’s been more than five weeks since the ACT Government announced it’s so-called ‘survival package’ for businesses doing it tough yet few, if any, businesses have been told if they will receive a rates waiver,” Opposition Leader Alistair Coe said.

”Given many property owners have waived or reduced rent or are in discussions, an understanding of whether they will get a rates waiver or reduction is vital information.”

The government said today (12 May) that it would apply rebates to property owners’ commercial general rates if they reduce rent for tenants significantly affected by COVID-19, backdated from 1 April 2020 for a period of six months.

Chief Minister Andrew Barr said that those most in need would receive the highest level of support through a tiered category system which encourages landlords to apply for a waiver or rebate on their commercial rates, linked to the amount of rental relief passed on to tenants.

The tiered categories also applied to affected owner-operated businesses.

”Under this scheme, a majority of landlords will potentially pay no commercial rates for six months, provided they are passing through rental relief to their tenants should they need it,” Mr Barr said, adding that commercial landlords would have to ensure they were doing everything they could to help businesses survive.

”The ACT Government has implemented the National Cabinet’s Mandatory National Code of Conduct, which requires landlords to negotiate in good faith with tenants financially impacted by COVID-19,” he said.

But if this did not achieve the desired results, the government may look to legislate aspects of the Code of Conduct.

The government intends that the Commercial Leases Declaration will expire on 30 September 2020.

A mediation process has been established to resolve disputes and the government has developed fact sheets to help landlords understand their requirements under the National Code.

The Local Business Commissioner will act as a Commercial Tenancy Mediator to assist landlords and tenants to negotiate amendments to their leasing agreements.

”The Commissioner’s role will be to assist parties to interact respectfully. This is a voluntary, free and confidential service. The Commissioner has already mediated around 40 negotiations with positive outcomes for both parties,” Mr Barr said.

The government has already provided over $350 million in economic survival measures in the past 10 weeks to support Canberrans.

This has included payroll tax waivers and deferrals for thousands of businesses, and rebates on the fixed charge for general rates for commercial property owners with an average unimproved value (AUV) under $2 million – covering 94 per cent of commercial properties in the ACT and providing an automatic $2,622 saving to those property owners in the June quarter.

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