Businesses, landlords say federal rent help falling short

Both small business owners and their commercial landlords in Ottawa are complaining a federal funding program meant to help them through the COVID-19 crisis is falling short.

Jo Arbuthnot is getting ready to reopen her boutique, Flamingo Boutique, next to the Parkdale Market, after being closed since March. She had hoped for help from the Canada Emergency Commercial Rent Assistance (CECRA) program, but said her landlord won't apply.

CECRA offers unsecured, forgivable loans to eligible commercial property owners covering a minimum of 50 per cent of the rent their tenants owe. In exchange, the landlord must reduce the rent they charge their small business tenants by at least 75 per cent for April, May and June.

"I think it should be mandatory. I think that's the only way to make landlords apply for it," Arbuthnot said.

Because her landlord didn't apply for CECRA, she's had to rely on online sales alone to cover her rent.

"It just means the bank account is empty, just means every time I'm packing an order online, all I'm doing is covering my rent. I'm working so hard to cover my rent."

Landlords need to pay bills, too

In an email to CBC News, Arbuthnot's landlord, Doug Edwards, said he would support the federal program if it required others to take a similar financial hit.

"I feel that for this program to be equitable, all those involved should also reduce their charges by the same 25 per cent," he wrote.

"This should include landlords, the landlords' mortgage lenders, the City as it relates to realty tax charges, and utility providers, and I believe participation should be mandatory."

The Building Owners and Managers Association of Ottawa is in favour of help for landlords, and has been advocating for tax breaks to help small businesses.

"We're still concerned about the amount of the arbitrary 25 per cent figure that's deemed as the profit that landlords make on their building," said Dean Karakasis, the association's executive director.

"That number is pretty out of whack for most landlords in terms of the actual profit, so they're taking a bigger hit than the government seems to think they're taking."

BIAs worry about the future

Arbuthonot isn't the only one worried about how to make ends meet.

"We've already lost at least five businesses that we know of, and it usually happens at the end of the month that we find out that someone is pulling the plug," said Dennis Van Staalduinen, executive director of the Wellington West Business Improvement Area.

The Ottawa Coalition of Business Improvement Areas is hearing from its members that the majority of landlords are not applying for the rent relief program, although some are trying to make alternative plans including postponing rent. 

"They're still accumulating the rent at a time when they're not not making any money," said Mark Kaluski, chair of the coalition.

"It'll be a long and slow recovery process. So even the ones who are making accommodations — it's still not really going to help businesses in the long term."