Victorian Government Ignores Pleas on Retail Leases during COVID-19

Date: 16 Sep 20

Media Release

At a time when retail properties are suffering the most, with many unable to operate and many more severely restricted in how they can operate, the Victorian Government yesterday passed the Retail Leases Amendment Bill 2019.   A number of pleas directly to the Premier, the Treasurer and other Ministers to pull the Bill from Parliament during the COVID-19 pandemic went unanswered.
The significant impact of the Covid-19 pandemic on the retail sector has substantially changed the landscape since this flawed piece of legislation was first drafted.   There was no genuine consultation with industry about the proposed changes last year.   The REIV advised Small Business Victoria from the very beginning that the legislation was fundamentally flawed.  With the onset of COVID-19 and the impact on the retail sector, a great deal of it will be unworkable and severely impact on retail.
The process of accurately determining market rents in the current environment is almost impossible.   The introduction of the legislation will result in many retail tenants requesting early rent reviews from Specialised Retail Valuers who will be faced with the difficult task of establishing a market rental during a crisis where very few new retail leases have been settled and many retail tenants have negotiated temporary rent reductions, all within tight new time frames.
The REIV calls on the Victorian Government to delay the commencement of this new legislation until well into 2021 when the retail sector has recovered from the current crisis. 
Comments attributable to Mr Gil King, CEO of the REIV
“It appears that this government refuses to talk with industry under the cover of Covid-19.   A number of pleas for the Bill to be pulled from Parliament were ignored and not even responded to.”
“These changes will increase costs for retail tenants at this difficult time as the cost of maintenance of essential safety measures are passed onto them.”
Comments attributable to Ms Leah Calnan, President of the REIV
“To proceed with these changes without even speaking with the industry is typical of what we are experiencing from the Victorian Government on many fronts during the rental moratorium.”

Media contact: Andrew Kilmartin – 0418 395 346