Landlords will be compelled by the Victorian Government to provide rent relief for eligible businesses suffering a severe downturn in trade due to the pandemic.
As small and medium-sized businesses emerge from lockdown the government will facilitate commercial rent waivers and deferrals.
Small Business Minister Jaala Pulford said many commercial landlords had done the right thing and offered rent relief — but it would now be a requirement for landlords to help eligible businesses that had endured a serious trading downturn due to no fault of their own.
“Victorian businesses have played a key role in the effort to keep us safe — making enormous sacrifices — and many of them are doing it really hard,” she said.
“As we emerge from lockdown, this is exactly the right time to provide relief for those businesses that need extra assistance to get back on their feet.”
The reintroduced Commercial Tenancy Relief Scheme will ease pressure by providing rent relief for eligible tenants, while separate support will be provided to landlords who do the right thing by their tenants.
The scheme will be available to businesses with an annual turnover of less than $50 million that have suffered a decline in turnover of at least 30 per cent due to coronavirus.
Landlords will be required to provide proportional rent relief in line with a business’s reduction in turnover. For example, a business with a turnover of 40 per cent of pre-pandemic levels can be charged only 40 per cent of its rent. Of the balance, at least half must be waived, with the remainder to be deferred.
A mediation service for tenants and landlords will further support fair tenancy negotiations.
Tenants and landlords will be encouraged to enter negotiations directly, with the Victorian Small Business Commission available to provide mediation if needed.
Legislation to enact the scheme will be introduced when Victorian Parliament resumes, backdated to apply from July 28.
An initial $80 million hardship fund will be established for landlords who provide rent relief to eligible tenants.
Tenants and landlords can contact the Victorian Small Business Commission for further information on 13 87 22 or visit vsbc.vic.gov.au