B.C. has become the largest province in Canada to impose a ban on commercial evictions for landlords who refuse to participate in the federal rent-relief program when their tenant qualifies.
The federal program offers to pay half of the rent owing if the landlord agrees to forgo a quarter of it and the tenant pays the other quarter. Some landlords have declined to participate, but B.C. Finance Minister Carole James announced Monday that those who don’t will not be allowed to evict tenants for non-payment of rent before June 30. Ms. James made the order under B.C.'s Emergency Program Act.
“Preventing landlords who are eligible for [the federal commercial rent-relief program] from evicting tenants can encourage landlords to apply for the program and give some temporary relief to businesses who have been hardest hit by the pandemic,” she said.
It’s a move that small-business advocates say is desperately needed and something they say Canadian provinces have been far too slow to act on. Only Nova Scotia and New Brunswick passed early bans.
“I would give Carole James a virtual-distance high five. This is going to give some anxious tenants some breathing room,” said Laura Jones, the Vancouver-based executive vice-president of the Canadian Federation of Business.
“In the absence of an evictions ban, the landlord has all the power in a negotiation,” said Jon Shell, who runs a financial non-profit in Toronto and is a co-organizer of a national Save Small Business campaign. “All we’ve ever asked for is for the burden of losses to be shared fairly.”
Mr. Shell pointed out that Australia quickly developed a system so that banks, tenants and landlords are all required to absorb some of the financial stress, rather than having a situation in which landlords somehow feel they are still owed 100 per cent of their rent even when businesses have been ordered closed.
But one local developer said he’s shocked that the province has moved to a system that will force many landlords to take a 25-per-cent cut.
“It’s probably going to put them in default,” said Jon Stovell, chief executive of Reliance Properties Ltd. “Until now, all the government subsidies were paid for by the greater ‘we.’ But now, they’re forcing one sector of industry to provide relief to another.”
He said that he himself has already agreed to participate in the federal Canada Emergency Commercial Rent Assistance (CECRA) program for his approximately 20 retail and restaurant tenants.
He can absorb the 25-per-cent loss on that because he has few tenants in that category. The remainder are office tenants, who don’t qualify because they didn’t experience anywhere near the 70-per-cent drop in revenues required for a tenant to be eligible for the federal program.
“But, for some guy who owns a little strip mall, it will be very hard to lose that 25 per cent,” Mr. Stovell said.
However, commercial tenants and those representing small businesses say it’s an important measure.
“My landlord is going to take the 25-per-cent hit, but not everybody is in that kind of position,” said Sharon Hayles, who has run Diane’s Lingerie on Granville Street for 38 years. She has heard that other landlords have been much tougher on their tenants, refusing to participate in the CECRA agreement for various reasons.
Mr. Shell said the indications he got, from a 2,000-business survey done 10 days ago, was that many of the 500 B.C. respondents both qualified for the program, because they had lost so much money, and hadn’t heard a positive response from landlords.
Of about a dozen B.C. businesses contacted by The Globe and Mail, half said the provincial ban won’t do anything for them because their losses hadn’t been high enough. The other half said they’d come to an agreement with their landlords to participate, some as recently as last week.
“It was pretty stressful, but the landlord finally said they were going to be applying,” said Tamara Komuniecki, who runs Delish General Store in North Vancouver.
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