What the July 14 Rent Relief announcement means for NSW commercial tenants, and why they should act now.

By FACTION Consulting

Following the announcement of Sydney’s lockdown extension on July 14, the NSW Government has announced a temporary support program that seeks to support commercial tenants. The program incentivises landlords to pass on rental relief to its tenants who may be in financial distress as a result of COVID-19 and in particular the most recent lockdown in NSW. The incentive for landlords is a significant land tax reduction or in some instances a complete exemption.

 

For commercial tenants, particularly SME’s trading up to $50m annually who have lost 30% or more turnover due to lock down, this provides a welcome relief – but questions remain on how the package is to be administered, and to what degree landlords are obliged to pass these tax cuts on to all tenants.

 

FACTION’s dedicated Director of Advisory, Adam Puddy, is on the ground in Sydney to assist tenants contend with these complex guidelines as they emerge. As Adam explains, “Right now all small to medium businesses need to be asking themselves what support they are entitled to if they have experienced a reduction in turnover due to the current lockdown, and what they can expect from their landlord if they cannot occupy their office or workplace and if their business has suffered directly from the pandemic.”

 

Whilst Sydney had very much been returning to normalcy since mid-2020, the current lockdown is a reminder of how exposed businesses are when the office and workplace is no longer accessible. This is why we believe it is great to see initiatives have been reintroduced by the NSW Government as we experience another wave of serious lockdowns, and why it is in tenants’ best interests to stay fully informed of their potential entitlements.

 

The focus of FACTION’s tenant advisory offering is firmly in helping our clients to navigate these new guidelines as more developments are announced, and more importantly facilitating discussions with landlords to help achieve rent relief.

 

For expert assistance in guiding your SME through this period of unknowns, please reach out to our Director Adam at [email protected]