By Melissa Higham - 3 Jun 2020
There has been much debate regarding what a fair rental
reduction is under commercial leases where businesses have been
affected by COVID-19. The Government had previously done nothing to
assist either Landlords or Tenants in this situation.
This morning Government have announced a compulsory
rent dispute process where the Landlord and Tenant have been unable
to agree on a fair rent reduction during COVID-19 lockdown, which
requires compulsory arbitration with Government subsidising the
arbitration by about 75%.
This new process is to come into effect from today (4 June 2020)
but will only apply in relation to businesses with 20 or fewer full
time employees on the site.
The process will be put in place by temporary amendments to the
Property Law Act.
This will only benefit smaller businesses and does not affect
Landlords and Tenants who have previously reached an agreement on
rental reduction.
Full details of the scheme have not yet been announced. If you
would like to be kept up to date with how the scheme works please
contact Melissa
Higham.