Simon Bridges has slammed the Government’s sudden move to require commercial landlords to offer rent relief when tenants can’t operate under lockdowns as a “shocker” in more ways than one.
Earlier this week Justice Minister Kris Faafoi unveiled new temporary rules to “help ease the impacts of COVID-19 restrictions” on businesses, including making it mandatory for commercial landlords to compromise on rent with their tenants during alert level restrictions.
Essentially, landlords and tenants will have to come to an agreement on what a “fair” amount to be paid is, and if they can’t, they’ll have to go to arbitration – where a third party can make a binding decision – or mediation to resolve their differences.
The NZ Property Council said it had no warning of the changes, which were announced on the same day the Bill that would make them law was presented to Parliament.
“It’s a shocker,” National MP Bridges told The AM Show on Friday. “It’s a shocker both in terms of the terrible process, which I think this Government is becoming more and more known for; but also in terms of the substance.
“It may sound a bit pointy-headed to New Zelaanders, but actually if you muck around with contract law you really undermine the basis for doing business.”
Let no mere mortal small business ever question the love of Captain Socialism and the NZ Labour Party!
We feast on Simon Bridges tears and the wailing of the fat cat commercial landlords! Watching Captain Socialism step into the most sacred space in Capitalism – the contract – is a special moment for us all!
Forcing fat cat commercial landlords to negotiate lower rents for small business is a reminder to those small businesses, who has your back? The Political Party prepared to punch fat cat commercial landlords in the face or the National Party who helps hold you down while the fat cat commercial landlords punch you in the face?
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Does anyone know what fair means tho ? Is it 50%? 25% Or do we have to pay lawyers to find out ?
Herd of the kiwi dream? It’s based on high rates of home ownership. That the homeownership rate is the lowest it’s ever been is totally unfair.
I’v been watching John Key draw closer and closer to the truth, that there is a housing crises. Now that it is undeniable, him and the rest of the national party just come across as delusional.
So when those landlords go broke then what? It’s an outrage that they’re getting punished to cover the shambles that is a Labour Government led policy of lockdowns.
Clearly we’re fast running out of money to pay for Labour’s failures so they’ve resorted to punishing landlords. It’s not going to end well and just looks as though they’re trying to kick the can down the road.
I thought Parker’s stuttering and stumbling in a terrible response to the reasonable question around whether any politicians had taken a pay cut said it all.
If they’re going to impose all this pain on us they should feel some too – it’s a farce and a disgrace.
You may rejoice that the so called fat cat landlords are having their businesses destroyed but it will only end up hurting us all. No tax revenue means no benefit payments. Labour are slowly but surely wrecking our nation
Very sensible Yeti
The pain of macroeconomic adjustments are in no way comparable to death! Absolutely no way comparable!
If scumlords can not survive on a neutral balance shit after decades of sucking on everyone’s tit, they can die first.
Landlord = Kulak in Labours eyes, and that didn’t go well did it?
Labour blunders into the field of commercial law: Expect a disaster. Expect more landlords to get out of the business and rents to rise in order to offset the additional risk created.
Darryl Kerrigan is on the phone for you Bomber. A couple of crumbs isn’t going to cut it particularly if your foot traffic is going to be cut in half over the next 6-12 months and a boomer day is breakeven.
And don’t even start on how the likes of Neale Jones will manipulate this for his corporate clients. The likes of the Warehouse and McDonalds will be laughing all the way to the banks.
Yes there might be fat cat landlords out there but a large number if not the majority will be Mum and Dad investors who have put everything on the line, often including the family home to secure finance for what is their superannuation fund.
They have bills to pay and mortgages and their lives and futures too have been wrecked by Covid.
The rushed piece of legislation is a sop to struggling businesses who are doing it tough but as Scott says what is “fair and reasonable “.
Good intentions do not make for good law.
Absolutely Pat Taylor.
To bash people who try to take care of their future well being is awful.
Success comes from hard work not good intentions.
“a large number if not the majority will be Mum and Dad investors” who made the housing market what it is today, a crisis. Kiwi’s need another sector to invest for their future, and leave the houses for those that want to own one, which is the Kiwi dream. Well, that dream is well and truly smashed thanks in no small part to mum and dad investors.
Well said Pat .. There are bad mean spirited landlords but most are normal workers who followed the governments instruction to make a safety net for themselves when the pension money runs out. I have owned 6 takeaways and all my landlords were individuals or groups . They had mortgages to pay along with insurance the upkeep of the building and compliance with constant changes from both government and council. I did not come across any fat cats. Who will pay their bills.
I wonder if anybody in the present line up of ministers has invested their live savings and taken a risk in a business as an owner or landlord.
Absolutely Trevor.
There is a warped perception of anyone who owns anything by a large number of New Zealanders.
The only current minister in the Labour Government to own a business that I know of is David Parker and he failed miserably.By the way that was before covid.
“The only current minister in the Labour Government to own a business that I know of is David Parker and he failed miserably”
How so John?
Do some research and you will find I’m right.
David Parker has even said so.
John, you make the claim, provide the evidence or are you trolling again?
Show me where Parker said so?
Very Good News, GREEDY Tenants!
Capitalism is failing. The bourgeoisie Neoliberal Capitalist Latte Labour Government haven’t got a clue how to address this catastrophic economic collapse in front of them so they chose to ignore it. Tinkering isn’t best practice.
But hey. The smile and wave at the cameras will work forever eh?
It’s a zero sum game so bring it on! The sooner the better.
”Does anyone know what fair means tho ? Is it 50%? 25% Or do we have to pay lawyers to find out ?’
No go to crown tenancy services the people who hold your bond.
Scott in answer to your question, from memory, I believe what is defined as a ‘fair rent’ is a rent in line with Tenancy services valuations within an area.
That is to say if Tenancy Services value the average rent for a three bedroom house within an area as $700 a week then the landlord should be asking for between $650 to $750. You can ask Tenancy services for advice on that.
This is what I did a fair few years ago when I was renting a place in Epsom and the new landlord tried to raise my rent by around sixty percent. When I told him I would go to the Tenancy Tribunal over it he dropped his demand to around ten percent more than we were then paying.
I admit I am quoting from memory so check out what I have just said. I am also puzzled by a ‘new law’ that allows for arbitration and mediation because I thought that already existed ( I used it).
This law is about commercial leases , not so easy , I got a reasonable deal last year from my landlord although only cause I pushed back hard, I would say the fat cats and big commercial landlords like the shopping malls will come up with something
It could be nice if the Minister would give interviews to the announcement but as usuall he’s hiding under his desk…
Like hate speech it’s half arsed offering no direction in law… what’s fair? Is it based on business income or the amount of mortgage / outgoings on the property? Or both? Does it override personal garuntees?
What a fucking MESS… meanwhile house prices are out of control, rents are seeing record rises and more than ever in emergency hotel rooms… it’s a fucking virtue signal that doesn’t really help and does fuck all to help the people that really need it….
Informing any decision – when there is business bankruptcy and no replacement tenant and so what does the landlord receive, nada.
Last year arbitration was all Winston Peters would agree to.
What about
Level 4 – the tenant pays 25%, the landlord receives 33% – the government provides 8% (4% gratis and 4% as an interest free loan the business pays back).
Level 3 – the tenant pays 33%, the landlord receives 50% – the government provides (8% gratis and 8% as an interest free loan)
Level 2 – the tenant pays 50%, the landlord receives 66% – the government provides 8% gratis and 8% as an interest free loan)
Of course essential businesses that operate at Level 4 are not included, nor those “office” staff firms that earn income by having people work at home.
And a limit on the size of the business that can qualify for government assistance – larger businesses can litigate with their landlords.
Took them long enough. We asked for it last year during Lockdown 4 where most of us ended up paying full leases as very few gave any reduction. Best one could hope for was that one could pay back the amount in smaller installments. And have done so for any other lockdown.
I guess if business tennants cant meet their rent due to no custom then its fair enough that commercial land lords share the small business pain and they get to keep their tennant in the long run. Now if the commercial landlords can’t meet their mortgage interest payments then they may need an even lower interest rate, better adjusted terms, some cancelled interest payments, some compulsory arbitration so the banks can share the pain too. Of course if the banks had already attempted to share the pain some landlords may have already been more willing to come the help your tennant party.
As Pat O’Day writes convincingly elsewhere, this action needs to go further. Under lockdowns 4 and 3 Al mortgage and rent payments should stop.
Mortgage holidays seemed like a good idea when first introduced but the interest kept acuring so rather than help they put the borrower further back . If you try to stop interest acuring then you are breaking laws on overseas banking as al or main banks are Australian.
Most newish commercial leases have this provision already, the usual/standard commercial leases were changed by the Auckland District Law Society to allow reductions in rent for similar restriction of access and use following the Christchurch earthquake. Government interference in private contracts is generally not something to be so casual about Bomber.
Businesses have a lot of fixed cost obligations besides rent – equipment leases, telecommunications contracts, supply contracts, insurances, council rates and various mandatory and moral obligations to their staff.
Should they be altered as well, and if not, why not?
Funny the did not do that when the froze residential rents about a year ago?
Commercial rents are one of the biggest rip offs there is and getting worse. But nobody talks about it.
Some of the commercial rent prices are eye watering, but luckily more and more businesses are going on-line, people are working from home, (also helping congestion) and so forth. Covid has created some positive changes in many areas.
Looks like a big buy up of brown field land!
Look out South Auckland!
Billionaire Graeme Hart is buying South Auckland industrial properties in five deals worth $189 million which took the sector by surprise.
This is at least a better outcome than the current trend of developers building on Green field land, as at least the land already has services to it.
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