Christ Yoder
Related Articles
On Friday, April 24, the Ontario government announced details of a new federal-provincial program to provide rent relief to owners and tenants of commercial buildings affected by the COVID-19 outbreak.
The new Ontario-Canada Commercial Rent Emergency Assistance Program (OCECRA) will provide forgivable loans to eligible commercial property owners who are unable to collect rent from their small business tenants.
The program will cost $ 900 million, including $ 241 million from the province.
Advertisement – story continues below
“The vast majority of small businesses and homeowners in Ontario are grappling with this extraordinary public health emergency,” said Premier Doug Ford. “I want to thank the federal government for partnering with us to help our small businesses and business owners.”
Under the program, tenants and small business owners would each be asked to pay 25% of rental costs before profit, with the federal and provincial governments covering the remaining 50% (with the federal government’s share being 37.5%. and that of the provincial government part 12.5 percent).
For example, if the monthly rent before profit for a small business is $ 10,000, the landlord would forgive $ 2,500, the small business would pay $ 2,500, the federal government would cover $ 3,750 and the province $ 1,250.
“By subsidizing rents, reducing taxes, extending deadlines and eliminating penalties and interest, we are helping to ensure that businesses can get started quickly at the right time,” said Finance Minister Rod Phillips.
To receive the 50 percent forgivable loan, landlords would be required to forgo rent profits (only fixed costs) and reduce rental costs for small business tenants by at least 75 percent from April. to June 2020 (25 percent for each month) and commit to a moratorium on evictions for three months.
Commercial properties with a residential component and mixed-use residential properties with a 30% commercial component would also be eligible for assistance for their commercial tenants.
To be eligible for OCECRA, a small business tenant would need to be a non-core business that pays no more than $ 50,000 in gross rents and has temporarily closed or suffered a 70% drop in revenue due to of COVID-19.
Non-profit organizations and charitable entities would also be considered for the program.
OCECRA would be administered by the Canada Mortgage and Housing Corporation and would be available until September 30, 2020. Assistance would be retroactive to April 1, covering the months of April, May and June 2020.
Premier Ford also announced he will call on the federal government to work with Ontario on a residential tenant support program, and said the Ontario government will release a framework early next week to reopen Ontario’s economy in a gradual and measured approach.
