MELBOURNE COMMERCIAL PROPERTY UPDATE
Can you believe we are already into the 2nd month of the year.
Just before Christmas we became aware the rent relief regulations were extended again until 28 March 2021, with provision to be extended until 26 of April 2021.
What does this mean;
- Rent relief to be applied based on % loss of turnover (as previous)
- Rent increases remain prohibited for any tenants who continued to be eligible for job keeper.
- Deferral payments due to commence 1 January required to be postponed under most circumstances.
In some cases, tenants who qualified for job keeper 1 & 2 have not remained eligible for continued support. In each instance we require a tenant to provide us with supporting documentation.
It is case dependant on how detailed our assessment is of the supporting financials. We receive instructions from our clients and make recommendations.
It is important to remember when negotiating rent relief December BAS does not necessarily support how a tenant will trade for the entire period January – March 2021.
A review of all claims was completed throughout the month of January.
We recommend reviewing any leases due for renewal in 2021! Strike now while things have settled down to some degree.
Every situation and client are assessed individually. The long-term strategy for the premises needs to be clear.
With the uncertainty in the leasing market especially in the retail space, our advice is to retain a tenant if a commercial deal can be negotiated. Both parties will incur a cost in the absence of compromise.