Ottawa

Rent relief package might not be enough, businesses warn

Local businesses are praising the federal and provincial governments for a new rent subsidy program designed to offer help during the COVID-19 pandemic, but some say it might not be enough to stay open.

Shared federal-provincial package announced Friday

The federal government has announced a new program to help businesses dealing with COVID-19 closures pay their rent, but there's worry the plan might not work as smoothly as intended. (Adrian Wyld/The Canadian Press)

Businesses are praising the federal and provincial governments for a new rent subsidy program designed to offer help during the COVID-19 pandemic, but some say it might not be enough for them to stay open.

On Friday the federal government announced a relief program, funded jointly by the provinces, that would provide non-repayable loans to commercial property owners to cover up to 50 per cent of their rent for April, May and June.

The loans would be forgiven if the property owner cuts rent by at least 75 per cent those months and promises not to evict their tenants. The small business tenants would pay the remaining portion of the rent.

Nick Ethier used to own five businesses in Ottawa-Gatineau — including an escape room and a pair of vape shops — but due to the pandemic he's shut down three of them, two permanently.

Ethier said as his revenues tanked, rent was hard to pay. He said the new program could help his remaining shops stay open — if his landlord agrees to apply for it. 

'Other fixed costs'

While it's a "step in the good direction," it won't be a cure-all for the economy, Ethier said, as many businesses will have other loans and costs to pay after months of lost revenue.

"There's the [wages for the] employees and all the fixed costs, utilities and the like. So it's not just about the rent part. There's other fixed costs that will stay the same," he said.

Ethier is now changing the scope of his remaining shops to sell more pandemic-related supplies like face masks and hand sanitizer. 

Dennis Van Staalduinen, executive director of the Wellington West BIA, is worried that if small businesses have bad relationships with their landlords, they might miss out on getting rent relief. (Laura Osman/CBC )

BIA concerned

Dennis Van Staalduinen, executive director for the Wellington West Business Improvement Area, said the pandemic has proven tough for small businesses — and while they're grateful for the help, some worry it'll be too hard to access.

"As has been the case with almost every other bit of aid that's been offered, there are too many strings attached. It's too complicated in terms of how it's being applied," Van Staalduinen said.

The fact that the landlord has to apply for the funding can be problematic, Van Staalduinen said, if they don't have a good relationship with their tenant.

A cheque from the government "would have been the simplest thing," he said.

"That could have been given to them, you know, a month-and-a-half ago. And then we could be talking about how we could keep that going."

ABOUT THE AUTHOR

Natalia is a multi-platform journalist in Ottawa. She has also worked for CBC in P.E.I. and Newfoundland and Labrador.

Add some “good” to your morning and evening.

A variety of newsletters you'll love, delivered straight to you.

Sign up now

now