Landlords play hard ball, say vulnerable traders

Warren HatelyAugusta Margaret River Times
Margaret River’s main street has been hit again, with some traders worried landlords will not help them through the economic fallout from COVID-19.
Camera IconMargaret River’s main street has been hit again, with some traders worried landlords will not help them through the economic fallout from COVID-19. Credit: file image

Hard-hit commercial tenants in the region are having mixed results negotiating rent relief with their landlords.

As the COVID-19 pandemic worsens and increasing numbers of businesses close, fears exist some non-resident landlords are protecting their bottom line instead of helping traders survive the crisis.

Traders who asked not to be identified told the Times a combined approach could be needed after some landlords offered to waive rents for the next few months — and then load those debts on to rents later this year.

Other traders said at least one landlord who didn’t live in the region “refused to budge” and wanted full rents ongoing.

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Chamber of Commerce president Melissa d’Ath said there were some “heart-warming stories” coming from commercial landlords, but confirmed it wasn’t all good news.

“There are landlords who are offering no relief or only deferred payments,” she said.

“Meaning the tenant is required to pay back the rent after a certain period of time or when they can reopen. This will make it difficult for a lot of small businesses when they are trying to get back on their feet and also pay 125-150 per cent rent.”

A local businessman involved in a dispute with his landlord said it was “not feasible to try and start your business back up with double rent”. “Hospitality and retail have seen turnover disappear or (become) so drastically reduced they are not viable businesses anymore,” he said..

“The banks, tenant and landlords ‘sort this out among yourselves’ approach will not address the underlying issues.

“We need legislation that will allow tenants who can demonstrate that the COVID-19 pandemic has drastically affected a business to break their leases without penalty.”

The Shire of Augusta-Margaret River was helping its own commercial tenants through the unfolding crisis, according to chief executive Stephanie Addison-Brown.

“The Shire is talking to its tenants and will be looking at flexible options relating to lease and rent payments,” she said.

“We are heartened to hear that some of the commercial landlords in Margaret River have already suspended rental payments for their tenants for a few months or have committed to reducing rents significantly, and we recognise that our own tenants will need the same consideration.”

Chamber board member Miriam Bailey believed the State Government would move to clarify the situation in coming weeks.

“We are encouraging people to talk to their landlords (and) start the conversation now,” she said.

“Can you get a temporary break? Can you get a reduction?

“If you are a landlord, can you get a deferral from your bank and then pass on that benefit to your tenants? Time for conversations to start happening if they have not already.”

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