The federal government continues to help small businesses stay afloat during these rough times. The new form of assistance comes with the Canada Emergency Commercial Rent Assistance (CECRA). We were informed previously that help would come for commercial rents if the provincial government stepped in and joined forces.

The CECRA is expected to help by essentially lowering rent by 75% for all affected small businesses. This assistance will be provided in partnership with those provinces and territories that would have jurisdiction over these rents.

The government will give these affected small businesses that qualify forgivable loans to cover 50% of three months of rent. These businesses would have experienced financial hardship during the months of April, May and June.

The stipulation is that these property owners would agree to reduce the eligible small business tenants’ rent by at least 75% for these affected months, including an agreement not to evict the tenants. The small business is required to cover the remaining 25% of the rent.

Businesses that pay more than $50,000 in rent per month will not qualify, another qualification is that the tenant would have ceased operations or experienced at least a 70% drop in revenues  relative to pre-COVID-19 levels.

Provinces will share in this program by covering 25% of the cost and this program will be administered by the Federal Canada Mortgage and Housing Corp.

These benefits are expected to be available for commercial tenants by mid-May.

Eligibility Requirements as stated on the Canada Mortgage and Housing Corporation site here.

  • The property owned must generate rental revenue from commercial property located in Canada
  • The property owner of the commercial property where the impacted small business tenants are operating from must apply.
  • A mortgage loan must be secured by the commercial property in question.
  • An agreement must be entered to with the tenants to reduce rent by at least 75% for the months of April, May and June.
  • The rent reduction agreement must also include a moratorium on eviction for the months the rent is reduced.
  • The property owner has declared rental income on a personal or corporate tax return for years 2018 and/or 2019.

There is also a note stating that property owners who do not have a mortgage, there will be an alternative plan that the government will implement in the near future. 

CECRA for small businesses is applicable to commercial property owners with 

  • Eligible small business tenants
  • Eligible small business subtenants
  • Residential components and multi-unit residential properties with commercial tenants. 

For those landlords that qualify they can apply here. 

Thank you to both federal and provincial governments for their continued assistance. If more information follows this blog will be updated.