Landlords offer more shops rent discounts and deferments

More shops will benefit from more generous rental discounts and deferments offered by landlords during the lockdown period.
More shops will benefit from more generous rental discounts and deferments offered by landlords during the lockdown period. Image: 123rf/Asawin Klabma

Landlords have increased and extended temporary rent reductions for retailers whose shops have been closed by the lockdown.

While a partial reopening of clothing and other non-essential stores is planned from Friday, demand is expected to be low as cash-strapped shoppers prioritise food and staple goods.

Earlier this month, the Property Industry (PI) group, which gathers together the major representative bodies for the real estate sector, announced a package of assistance and relief for the retail sector as proposed by the government.

This included rent discounts of 35% to 100% for small enterprises, and 15% to 35% for all non-essential retailers for two months.

On Tuesday, the group said following the extension of the lockdown, it was now offering non-essential, medium-sized to large retailers rent discounts of 60% to 70%, as well as rent deferments of 40% to 50% for three months from April.

Highly to moderately affected retailers, such as restaurants, hairdressers and movie theatres, will be offered 50% to 100% rent discounts and up to 45% rent deferments.

“The initiative targets preserving jobs for retailers, their suppliers and service providers. To qualify for the relief benefits, retail tenants will need to undertake not to retrench staff during the relief period,” the PI said.

The plan follows the publication of government rules allowing landlords and tenants to negotiate lower rents or rent holidays – a move seen as giving state endorsement for further relief measures.

Shopping centres account for R789bn, or about 72%, of annual retail sales, according to the PI.

“We need to stand together and find workable solutions that will benefit the country, protect jobs and sustain our businesses through this challenging time,” said PI spokesperson Estienne de Klerk.

“We believe what we are offering is balanced and addresses some of the key issues on both sides. It is an equitable way to protect both industries and, very importantly, looks after the drivers of employment creation, the SMMEs (small, medium and micro enterprises).”

BY REUTERS

Leave a Reply