First Covid-19 rent reduction request received

[Perry]

Artemis has posted information of what tenants should do.

(I.e. Where LLs should point tenants to.)

[tmouse]

Tenant ceasing to pay rent and outgoings

Email from tenants property manager.

On Monday and in response to the Covid-19 pandemic, the Government moved New Zealand to Alert Level 4 effective 25 March 2020.

“This imposes a near complete societal lockdown effective for at least the 4 weeks from that date. Accordingly, ... must cease operation or trade until further notice, and in compliance with the Government’s directive, we can no longer access and occupy our premises.

Until ... ability to operate or trade from its premises resumes, the foundation of its commercial arrangement with its landlords must also be suspended recognising the extreme financial and operational impact that has been imposed. Accordingly, ... will cease to pay rent and outgoings (together “rental”) until the Alert Level reduces to a point where occupation and trading can resume.


Your thoughts on this matter welcomed?

[simongu]

Yes, have done this (via the property manager) but my point is more around just taking tenants word for it that they cant pay the rent and we LLs should become their bank?

[Perry]

Simply: no.

Nor their charity benefactor.

[Bluecoat]

One of my tenants whose children moved out gave me notice to vacate about one ago. He has secured a 2 bedr unit for $520 Due to lock down , he is looking at a reduced rent to stay on. My 2 storey 4 bedroom house located on its section was rented at $690. I have cancelled the rate increase about the same time.

How hard is it to get tenants in Auckland during this time ?

[Beano]

That's what I'm concerned about. So 100% or 50% off for the month? ...or allow him to defer the months rent and pay it off in installments over a few months starting after lockdown?

Bob Jones for his retail tenants apparently deferred three months rental spread the total over the balance of the lease.

[Beano]

That's interesting, I wonder how to interpret this: "a fair proportion of rent and outgoings shall cease to be payable"? How would one calculate that?

It's really hard to work out . If it is a warehouse storing goods to sell at Xmas time and the warehouse is full ...perhaps no refund. If it a office that now works from home . Very little . A takeaway a lot. ADLS ver 6 second schedule 27.5 and 27.6 only indicates "fair'

[limecurry]

COVID and rent

Hi

My tenants have advised, already(!) that they're unable to pay the rent, at least temporarily. One was self employed and the partner had recently become a WINZ beneficiary.

I get that it's tough for everyone in this new world. What I don't want, is to be taken advantage of. How would one know if tenants were in receipt of income replacement, accommodation supplement or any other targeted financial assistance that should enable them to pay the rent?

It doesn't seem reasonable to me to start the usual rent arrears processes and notices, and I doubt that it'd proceed through the Tenancy Tribunal process ATM anyway.


Thanks
Lee


Your great grandparents went to war for you, you're being asked to sit on the couch and wash your hands. Please.. Stay home, save lives, be kind.

[Bradley]

Email from tenants property manager.

On Monday and in response to the Covid-19 pandemic, the Government moved New Zealand to Alert Level 4 effective 25 March 2020.

“This imposes a near complete societal lockdown effective for at least the 4 weeks from that date. Accordingly, ... must cease operation or trade until further notice, and in compliance with the Government’s directive, we can no longer access and occupy our premises.

Until ... ability to operate or trade from its premises resumes, the foundation of its commercial arrangement with its landlords must also be suspended recognising the extreme financial and operational impact that has been imposed. Accordingly, ... will cease to pay rent and outgoings (together “rental”) until the Alert Level reduces to a point where occupation and trading can resume.


Your thoughts on this matter welcomed?

https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12320625

You're clearly not the only one in this position. Now it's been publicised, expect a lot more companies digging their heals in.

As a tenant, it's clearly in their longer term interest to come to a reasonable agreement rather unilaterally refusing to pay their lease.

[mrsaneperson]

Landlords are in tough time situations too, let's not dig a hole for ourselves with the governments spade. Tenants should be meeting their rent payments as the government has said they are entitled to wages lost plus rent top-ups.

I fear though this situation is a grotesque response to a very small issue which has been taken out of all proportion. Perspective is lost.

The supposed lockdown cure is worse than the problem itself.

[Sanya]

I have had tenants approach me to delay rent payments whilst they are seeking Government assistance.

They are self employed and the lock down means they can't work.

As the Gov is processing lots of claims right now I've said to the tenants a delay of 2 weeks is fine and to let me know if Gov assistance doesn't come through in that period.

It is deeply concerning that a large percentage of kiwis have no meaningful savings.

[Calebp]

A mortgage holiday is not a true holiday .
It is an additional loan that accrues interest from day one .
Hence if the landlord passed this on the tenant would have to pay rent plus interest.

Also, from what I've seen posted, mortgage holidays are for owner occupied homes only. Investments don't apply, and won't receive mortgage holidays. Business as ususal?

[Bradley]

Another article has appeared in Stuff today relating to commercial tenants that have stopped paying their rent.

The word "suspend" has been used, even for the Bob Jones properties, which I understood was a deferment. There is also a quote from Wellington Hospitality Group manager Jamie Williams stating that most landlords are able to draw on loss of revenue insurance to cover the shortfall.

I'm concerned that these types of articles, full of assumptions and half truths, are going to muddy the water with our tenants and the deals that we have already put in place due to the level 4 restrictions.

[donna]

Also, from what I've seen posted, mortgage holidays are for owner occupied homes only. Investments don't apply, and won't receive mortgage holidays. Business as ususal?

Where did you hear that it was owner occupied homes only?

cheers,

Donna

[sparxNZ]

New S.145 and schedule 5 provisions.

So it looks like one of my tenants may have decided to take this opportunity to save as much money as possible by using the current crisis to stop paying rent, and stop communicating with me about it.
I suppose I can't complain, this will be the second time in ten years I've had to terminate a tenancy and the last time it was a PM doing it for me anyway.... So I guess I could say I've never had to do it.
So realistically with the new 60 days provision and the other provisions in S.145 and schedule 5 how long do the experts think it's going to take me to evict these people if they don't pull their socks up?

Cheers
Sparx