Rent freeze off table but guidance coming for tenants, landlords – Govt

30th April 2020 By Staff Reporter | news@tourismticker.com | @tourismticker

Many tourism and hospitality businesses are unable to open under Covid-19 alert level 3. Image: TT

The Government says it won’t bring in a rent freeze because it might benefit landlords.

The announcement yesterday came as calls for some form of commercial rent relief grew louder from tenants shut out of their premises because of the lockdown.

“We had heard the call to subsidise rent or to freeze rents,” Justice minister Andrew Little said.

“However, both of these approaches would have meant commercial property owners would have had their income protected at a time when no one else enjoys that privilege.

“It wouldn’t be fair to bring in a rent freeze for every situation because the lockdown has affected businesses in different ways.

Little said many landlords had already agreed to rent reductions.

“Landlords need to share the burden of Covid-19 fairly with their tenants,” he said.

Around 75% of the economy was now up and running again under Covid-19 alert level 3.

“We know many businesses, especially our smaller ones, have been hard hit by a drop in revenue and are struggling to meet their fixed costs,” Little said.

Cabinet Economic Development Committee ministers yesterday discussed options around changing the Property Law Act to support New Zealand businesses in managing their rent.

It included how parties to a commercial lease would be expected to consider rent concessions in whole or in part for a period where the response to Covid-19 has had a material impact on a business.

“The Property Law Act and the Residential Tenancies Act are entirely different pieces of legislation, with different types of rights and case law,” Little said.

“We have already announced we will amend the Property Law Act 2007 to push out deadlines on lease terminations, but it is clear from information we have received this alone is not enough in many cases.”