The Victorian Government has extended the Commercial Tenancy Relief Scheme (CTRS) for two months until 15 March 2022.

CTRS is designed to support struggling retail and commercial tenants and encourage renegotiation of terms.

Alongside the extension come new regulations. While the 2022 regulations are broadly similar to the previous CTRS regulations, there are some changes to eligibility requirements.

What has changed?

Eligible tenants must now have an annual turnover of less than $10 million for the 2020/21 financial year (compared to $50 million under the previous scheme) and have had a drop in turnover of at least 30% or more because of COVID-19.

 Your obligations and rights as a landlord

Under the scheme, landlords must provide proportional rent relief to commercial tenants in line with any reduction of turnover against pre-pandemic levels.

So a business whose turnover in January 2022 is 40% less than in January 2020 can only be charged 40% of its rent. Of the remaining 60%, at least half needs to be waived with the remainder deferred.

The ban on rent increases and evictions will continue, and landlords will not be able to lock out or evict tenants without undertaking mediation through the Victorian Small Business Commission.

Eligible commercial landlords who provide rent relief under the extended scheme will continue to be supported through the $20 million Commercial Landlord Hardship Fund.

Adam Zuchowski is a leasing lawyer at Sutton Laurence King Lawyers.

Need expert advice on a commercial lease? Contact Sutton Laurence King today on 03 9070 9810 or info@slklawyers.com.au for help.