The Canada Emergency Commercial Rent Assistance (CECRA) for Small Businesses
Today the Prime Minister announced more details on the Canada Emergency Commercial Rent Assistance (CECRA) program for small businesses. The CECRA aims to lower rent by 75% for small businesses that have been affected by COVID-19.
The Canada Mortgage and Housing Corporation will administer and deliver the CECRA, a program partnering the Federal Government and Provincial and Territorial Governments, which are responsible for property owner-tenant relationships.
Further details about the program include:
- The program will provide forgivable loans to qualifying commercial property owners to cover 50% of three monthly rent payments that are payable by eligible small business tenants who are experiencing financial hardship during April, May, and June.
- The loans will be forgiven if the mortgaged property owner agrees to reduce the eligible small business tenants’ rent by at least 75% for the three corresponding months under a rent forgiveness agreement, which will include a term not to evict the tenant while the agreement is in place.
- The tenant will be responsible for covering 25%, the property owner 25%, while the Federal Government and Provinces will share the remaining 50%.
- Impacted small business tenants are businesses paying less than $50,000 per month in rent and who have temporarily ceased operations or have experienced at least a 70% drop in pre-COVID-19 revenues. This support will also be available to non-profit and charitable organizations.
It is expected that the CECRA will be operational by mid-May, with commercial property owners reducing the rents of their small business tenants for the months of April and May (retroactively) and June.