Canada Emergency Commercial Rent Assistance – As extended to August 2020

Published: August 31, 2020
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Abstract

The rent assistance will be provided through forgivable loans to property owners leasing property to eligible small businesses. In order to qualify for a forgivable loan in relation to the rent paid by an eligible small business, the property owners must have signed an agreement to lower the rent of a tenant small business by at least 75% and to not evict the tenant during the period of reduced rents. The loan will be forgiven if rents are in fact lowered by at least 75%. The loans cover 50% of the gross rent owed by impacted small business tenants during the 3-month period of April, May and June 2020, prior to any rent reductions.
Eligible small businesses are those who:
  1. pay no more than $50,000 in monthly gross rent per location;
  2. generate no more than $20 million in annual gross revenues, calculated on a consolidated basis; and
  3. have temporarily ceased operations (i.e. generating no revenues) or have experienced at least a 70% decline compared to pre-COVID-19 revenues over the period.

Forgivable loans are extendable to include July and/or August rent where landlords choose to grant rent relief for July and/or August to eligible tenants based on their revenue declines in April to June. Loans and loan forgiveness will be available retroactively. Most provinces bear 25% of the cost of the program, up to a cap based on 25% of the initially estimated cost of the program; however, the cost of the program will not be shared in the territories or Prince Edward Island.
PBO estimates federal cost of this measure to be $931 million in 2020-21. The time horizon for this costing is aligned to the PBO’s current Economic and Fiscal Scenario.

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  • 27 May 2020

    Introducing rent assistance for small businesses. 
    The rent assistance will be provided through forgivable loans to property owners leasing property to eligible small businesses. In order to qualify for a forgivable loan in relation to the rent paid by an eligible small business, the property owners must have signed an agreement to lower the rent of a tenant small business by at least 75% and to not evict the tenant in April, May, or June of 2020. The loan will be forgiven if rents are in fact lowered by at least 75%.
    Eligible small businesses are those who:
    1.    pay no more than $50,000 in monthly gross rent per location;
    2.    generate no more than $20 million in annual gross revenues, calculated on a consolidated basis; and
    3.    have temporarily ceased operations (i.e. generating no revenues) or have experienced at least a 70% decline compared to pre-COVID-19 revenues. 
    The loans will cover 50% of the gross rent owed by impacted small business tenants during the 3-month period of April, May and June 2020. Loans and loan forgiveness will be available retroactively, provided an application is made by 31 August 2020. Most provinces bear 25% of the cost of the program, up to a cap based on 25% of the initially estimated cost of the program; however, the cost of the program will not be shared in the territories or PEI.