Canada Emergency Commercial Rent Assistance

The Canada Emergency Commercial Rent Assistance initiative has been introduced by the Canadian Federal Government to provide relief for small businesses impacted by the COVID-19 pandemic. Here’s what you need to know.

What is Canada Emergency Commercial Rent Assistance?

Canada Emergency Commercial Rent Assistance, or CECRA, offers unsecured, forgivable loans to eligible commercial property owners. This allows them to reduce the rent owed by their small business tenants, as well as meet operating expenses on the affected properties.

How does CECRE work?

Commercial property owners will offer a minimum of 75% reduction in rent for the months of April, May and June 2020. This means that 25% will be received from the tenant, 50% will be covered by forgiven loans from the government, and the landlord will be required to forgo the remaining 25%. Federal and provincial governments will share in the cost of the loans.

Applications are open until 31 August 2020, and the benefits will be applied retroactively if approved after the relevant period.

As a commercial property owner, am I eligible for CECRE?

To qualify for CECRE, you must:

• own commercial property occupied by one or more impacted small business tenants, and
• enter into a legally binding agreement with each affected tenant to reduce rent by at least 75% for the aforementioned three month period.

The agreement made with each tenant must include a moratorium on eviction for the relevant period, as well as a declaration of rental revenue.

What if I’m a small business tenant?

If you pay no more than $50,000 in monthly gross rent per location, generate no more than $20 million in gross annual revenues, and have experienced at least a 70% decline in pre-COVID revenues, your small business will be eligible for the CECRE program - provided that your property owner is also eligible.

By taking part in the program, the property owner must agree that the 75% rent reduction for your tenancy is forgiven, meaning that they cannot attempt to recover it from you at a later date.

Where can I find more information?

For further details on eligibility requirements, the application process, and additional support and resources available to both commercial property owners and small business tenants impacted by the COVID-19 crisis, please visit Canada Mortgage and Housing Corporation.