Rent relief available for Covid strife
Rent relief is now available for hard pressed printers, with the Commonwealth government announcing a mandatory code of conduct for commercial landlords and tenants that allows commercial renters to pay reduced rent during the Covid-19 pandemic.
Under the code, landlords are not allowed to end leases if tenants do not pay. Landlords are also not allowed to raise rents during the pandemic period. However, tenants must stick to the terms of their lease. “Material failure to abide by substantive terms of their lease will forfeit any protections provided to the tenant,” the code says.
Rent relief will be in the form of waivers and deferrals and rent waivers must account for at least half of the rent reduction. The reduction is to be based on the decrease in the tenant’s business turnover.
The repayment of deferred rent must be amortised over a period of at least 24 months, and up to the full term of the lease. And, repayment will not begin until the end of the pandemic period, or the lease expiring, whichever is the longer amount of time.
A business is eligible if it has a turnover of less than $50m, and is eligible for the Jobkeeper programme, meaning it has seen a 30 per cent decrease in revenue because of the pandemic. Parliament is sitting today to pass the $130bn Jobkeeper package.
At a press conference yesterday, Prime Minister Scott Morrison said the code is designed to support SMEs, be they a tenant or a landlord and bring together a set of good-faith leasing principles.
“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.
“And so this is seen as a proactive, a constrictive and cooperative mechanism for landlords and tenants to see this through together.”
The full text of the mandatory code of conduct can be downloaded from the government here.
Andrew Macaulay, CEO at Print & Visual Communication Association, said the association would start hosting webinars about the rent relief package, with legal and government experts to explain the ins and outs of the programme.
“Some of our members are tenants, and some of our members are landlords – the code is relevant to both,” he said.
“We encourage all industry participants – not only our members – to participate in the webinars. They are the best way for people to get themselves up to speed quickly.”
To take part, printers need to email firstname.lastname@example.org to register for the webinar, with a link being sent out about half an hour before it is planned to start. Webinars are hosted daily at 3pm.
Macaulay also encouraged PVCA members to reserve a briefing with the association’s legal team to review lease arrangements in light of the new code.
Kellie Northwood, CEO at The Real Media Collective, said any economic relief is welcome, but TRMC is closely watching the Jobkeeper programme’s progress through Parliament, as being eligible for the programme is a prerequisite for rent relief.
“There are some concerns that the eligibility criterium of a 30 per cent decrease in business is too much for our industry,” she said.
“For some of our smaller members, a 10 per cent or 20 per cent decrease in business would be crippling. In the print industry, we have high margins, high labour costs, and high energy costs. We're worried that 30 per cent might be too ambitious for these programmes.”