Small businesses welcome new federal rent relief as lockdown looms, but it's too late for some

Small businesses and the Ontario Chamber of Commerce are applauding the federal government's revamped commercial rent relief for COVID-19, but they say funds need to flow now as new lockdown measures take effect.

It's already too late for Darwin Miranda, who opened his business in Kensington Market 15 years ago. 

"We have supported public health restrictions from the very beginning and we understand closing a business is necessary to fight this pandemic," said Miranda, whose martial arts gym, Krudar Muay Thai, has been closed for in-person classes for the past eight months. 

After falling four months behind on rent two weeks ago, just days after Ontario's ban on commercial evictions expired, he was shocked to find his keys to his business didn't work.

"We arrived to find the locks changed, said Miranda. The landlord had] seized the business's assets and left an eviction notice."The sad part is that we know we are not alone. There are thousands of small businesses in the same situation."

It's a story that might become even more common now that the Ontario government has brought in COVID-19 new restrictions, imposing a lockdown on Toronto and Peel Region that will come into effect on Monday.

Small businesses had long complained that to get rent relief under the federal government's Canada Emergency Commercial Rent Assistance (CECRA), landlords had to agree to participate. The new program, which opens for applications on Monday, doesn't require buy-in from those who rent commercial space to business owners.

The new rent subsidy will go to tenants rather than landlords.

Rocco Rossi, president and CEO of the Ontario Chamber of Commerce, says the changes are long overdue.

"Many months have passed since we and other groups were saying that the original rent subsidy program was flawed in that it was trying to offload the responsibility to landlords," said Rossi. "We're delighted that it's tenant focused and driven, but the money has to flow."

The new support measures, announced Friday, will provide up to 65 per cent assistance for rent, with small businesses in areas where public health lockdowns are in effect qualifying for an additional 25 per cent subsidy, adding up to 90 per cent of their rent.

The rent relief is also retroactive to the end of September.

Gwen Bang of the Kensington Market Business Improvement Area says she hopes landlords are not forgotten when it comes to financial aid.

"We are also asking for support for commercial landlords whose tenants cannot pay because their livelihoods are destroyed by the COVID-19 pandemic," said Bang.

Rossi agrees.

"Many landlords are small businesses themselves and have their own expenses to cover," he said. "All our members want to do the right thing … so financial supports must come at the same time as you restrict their ability to do business, and that is the same for landlords and tenants alike."

In tandem with announcing lockdowns for Toronto and Peel Region, Premier Doug Ford says the province will provide up to $600 million in support for businesses to offset the costs of electricity and property taxes. 

Rossi says it is crucial for all levels of government to provide such support if as many main street businesses as possible are to make it through the COVID-19 pandemic. He said tens of thousands of businesses have likely already decided to pack it in.

"The Ontario Chamber of Commerce just completed a survey in October, and for our members with 20 or fewer employees, a quarter of them say they will not survive a second lockdown," said Rossi.

"I've heard from members in the restaurant and hospitality area that we could see over 50 percent of all restaurants going bankrupt before the end of the crisis."

What Miranda, of Krudar Muay Thai, would like to see on top of the retroactive rent relief announced, is a retroactive commercial eviction ban.

"Without these two supports our communities will lose their small businesses, job loss will be significant and we will lose the very fabric that strengthens ties our communities together."