ARTICLE
21 November 2020

NSW landlords begin weaning tenants off COVID-19 rent relief

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Holding Redlich

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Holding Redlich, a national commercial law firm with offices in Melbourne, Canberra, Sydney, Brisbane, and Cairns, delivers tailored solutions with expert legal thinking and industry knowledge, prioritizing client partnerships.
Landlords can start to alert tenants to the end of rent relief - some on 31 December 2020 and others on 28 March 2021.
Australia Real Estate and Construction

It now seems the NSW Government will transition tenants off COVID-19 rent relief. The current C-19 rent moratorium ends on 31 December 2020. This broadly means landlords can take 'prescribed actions' for breaches and do other things - like increase rents. Subject to agreements made under the regulations, it can also trigger repayments of deferred rent.

However, it is a weaning process. On 17 November 2020, the NSW government announced its C-19 regulations will have a limited extension until 28 March 2021 - that is, the extension is only for a limited class of tenants. The media releases and available information suggest relief will be ongoing until 28 March 2021 for retail leases with turnovers of less than $5 million, and where the tenant's December quarter turnover fell by at least 30%. It is not clear when the laws will formally be made, or how they will practically operate - for example, is $5 million turnover based on 2018/2019 figures?

Landlords may now consider alerting tenants to the likelihood of the laws ending - for some on 31 December 2020 and others on 28 March 2021. Such notification can be beneficial: tenants could begin provisioning to repay deferrals. Further, it may encourage tenants in developing a post-C-19 mindset. It seems in no one's interest - not landlords, tenants, customers nor NSW more broadly, for the C-19 relief to end with a jolt.

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