Victorian rent relief extended until the end of 2020.

24 August 2020 | Reading time: 2 minutes

As described in our previous blog, the current COVID-19 Omnibus (Emergency Measures) (Commercial Leases and Licences) Regulations 2020 (Regulations) apply from 29 March 2020 to 29 September 2020.

On 20 August 2020, the Victorian Government announced that it will extend the commercial tenancy relief scheme from 29 September 2020 until 31 December 2020.

Key takeaways from the latest announcement include the following points:

Extension of moratorium

  • Landlords will continue to be prohibited, until 31 December 2020, from:
    • tenant evictions (except in specific circumstances); and
    • any rent increases.
  • We are awaiting further details from the government as to whether this extension also applies to rent relief.

Rent relief to be ‘proportionate’

  • Under the current Regulations, a landlord’s offer of rent relief can take into consideration the landlord’s financial ability to offer rent relief.
  • Under the new regime, additional measures will be introduced to ensure that landlords are required to provide rent relief in proportion with the downturn in turnover being experienced by eligible tenants. There was no mention of the need to consider the landlord’s financial ability.
  • Further details as to how this will work are still to be provided.

Further land tax relief

  • The Victorian Government will also be increasing land tax relief to landlords. Landlords who provide tenants with rent waivers can receive up to a 50% waiver of land tax for 2020 (which is an increase from 25% as discussed in our previous blog).
  • Land tax relief will also be extended to certain owner-occupiers of commercial properties.
  • In addition, eligible commercial landlords may also be eligible for a grant of up to $3,000 under the latest announcement.

Additional powers of the VSBC

  • Another key takeaway from the latest announcement is the increased powers for the Victorian Small Business Commissioner (VSBC).
  • The VSBC, which has been overseeing commercial tenancy rent negotiations, will have greater powers to make orders pertaining to rent relief where a landlord refuses to respond to a tenant’s request for relief. Under the current Regulations, the VSBC does not have the power to make such orders.

Continued monitoring

It remains to be seen how the Victorian Government will implement these latest changes. The Bespoke Leasing Team will continue to monitor legislative developments and keep you updated.