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New COVID-19 Relief Packages for Landlords and Tenants

In response to recent lockdowns, both the NSW and Victorian Governments have announced new COVID-19 relief packages.

18 months down the track, many businesses, landlords and tenants in Victoria and New South Wales are still facing financial hardship or struggling to stay afloat as a result of the COVID-19 pandemic. Following the latest lockdowns, both the New South Wales and Victorian Governments have announced relief assistance for commercial tenancies to provide immediate support. 

Read on to find out how this latest round of government support could benefit you. 

Support for Tenants in Victoria

On 24 August 2021, the Commercial Tenancy Relief Scheme Regulations were enacted across Victoria in response to the ongoing economic impacts COVID-19 has on our landlords and tenants.

Compensation for Commercial Building Owners 

In addition, the State Government also announced an $80 million fund to compensate commercial building owners that have provided rent waivers to impacted tenants. 

Previous Schemes

While it has been queried if the Government will clear any of the grey areas under the previous schemes (such as Outgoings and the powers of the Small Business Commissioner and VCAT), we will not know the full impact of the new scheme until the legislation has been passed. 

Additional Financial Assistance

The Tenancy Relief Scheme is in addition to $400 million in Federal and State support for Victorian businesses, comprising of: 

  • $85 million for Small Business COVID Hardship Fund 
  • $156 million for Business Continuity Fund 
  • $70 million for Licensed Hospitality Venues 
  • $9.8 million for Aline Businesses 

Support for Tenants in New South Wales 

The NSW Government recently passed the Retail and Other Commercial Leases (COVID-19) Regulation 2021 (NSW) for a prescribed period from 13 July to 20 August 2021. 

It is important to note that the NSW regulations do not provide for a prescribed rent relief scheme – they only operate to prevent mass evictions by requiring landlords to mediate with any defaulting tenants. 

Eligible Tenancies

In order to qualify for the Retail and Other Commercial Leases (COVID-19) Regulation 2021 (NSW), the tenant must provide the landlord with a statement and evidence outlining that it is an ‘impacted lessee’ that meets the following criteria: 

  1. The lease must have been in place prior to 26 July 2021 
  2. The tenant must qualify for one of the following: 
  • Micro-Business COVID-19 Support Grant
  • COVID-19 NSW Business Grant
  • Job Saver Grant
  1. The tenant must have a turnover of less than $50 million.

Once evidence has been provided, the landlord cannot terminate the lease or evict the tenant for non-payment of rent, outgoings, or an inability to trade. However, it is important to note that landlords can still terminate and evict for breaches prior to 12 July 2021, if those breaches are not related to the economic impacts of the pandemic. 

Following the announcement that restrictions will be in place until the end of August (and little respite in case numbers to date), it will be interesting to see if the NSW Government will revise these regulations to include mandatory rent relief. 

Please note that different regimes will apply depending on the nature of the tenancy – even though the above is common to both retail and commercial tenants. For further assistance with your unique situation, please get in touch with one of our leasing experts for a free consultation. 

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