Government must set an example for Landlords

Dr David Lee, Member of Parliament for Pointe-a-Pierre.

Government must lead by example if it wants landlords to have a heart towards their tenants, during the current COVID-19 crisis.

Making the observation is Dr David Lee, Member of Parliament for Pointe-a-Pierre.

In a press release issued today, Dr Lee argues that several State-owned commercial properties are demanding rental fees from their tenants, notwithstanding the current crisis, and Government’s moral suasion.

The Pointe-a-Pierre MP maintains that the time has come for Government to end its moral suasion and directly intervene, using legislation, if necessary, a call he has made previously.

According to Dr Lee, these commercial landlords are ignoring the current realities and exerting undue pressure on their tenants to cough up their regular payments, even though these businesses have not been able to operate for at least six weeks.

The full text of the statement from the Pointe-a-Pierre MP, follows…

MP LEE – GOVERNMENT MUST SET AN EXAMPLE FOR LANDLORDS

Given the Prime Minister’s recent call for landlords to have a heart towards tenants who have lost income and unable to pay rent, it is essential that the government lead by example as it relates to the tenants who rent properties controlled by the state.

If the Prime Minister wants landlords to “have a heart” for tenants, then it is only acceptable that his own Government abides by this same call of goodwill by offering deferrals and protection from rent to tenants who rent properties within the remit of the state.

It is quite astounding that while the Prime Minister issues these calls to private landlords, the Government by virtue of acquiring the assets of CLICO controls Trincity Mall, Long Circular Mall and One Woodbrook place, which are all demanding thousands of dollars in rent from tenants despite the crisis.

The present economic situation for renters at these malls is quite damning as hundreds of store owners at these malls which employ approximately 1,500 workers are in financial jeopardy as they have earned no revenue within the last 6 weeks, but are being forced to pay tens of thousands in Common Area Maintenance Charges, Utilities, Promotion fees, food court charges and related value-added taxes.

It is quite distasteful that the management of these malls are not taking into consideration that the lease agreements with tenants were based on “open mall” conditions which allow customers to shop within the stores of tenants. However, in abiding by the Public Health Ordinance these entities were not allowed to open, thereby raising the question, “how could usual contractual obligations apply if the normal business operation was not facilitated?”

Further management must take note of the “force majeure” conditions or unforeseen conditions such as the shutdown caused by COVID-19 which prevents tenants from fulfilling their contractual obligations as they themselves were prevented from operating within the very business model and stipulations that were agreed to.  

Both the Government—given that it has control of these assets—as well as the management of the malls must understand that the financial crisis these stores face will prolong beyond the re-opening of the economy as demand is expected to be reduced, subsequently leading to renters not being able to possibly break even when they restart operations.

Therefore, I urge the Government to end the charade of moral suasion. It is a time for action to ensure the welfare of small businesses are protected. This can only be done by direct government intervention in the properties they control as well as with legislation which protects renters from eviction and their property being levied

The Prime Minister has the ideal opportunity to act as one of the “Landlords with heart” towards renters by working to protect the tenants of the malls within the state’s remit which would set the platform for other private entities to follow. Failure to do so would lead to the collapse of hundreds of local retailers and retrenchment of thousands.