Rent relief for salon owners in 2021 Lockdowns

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Posted August 2, 2021

With every day that lockdowns continue and expand across the country, we see more and more salons struggling to meet their commercial rental payments. Rent is undoubtedly one of the largest expenses for salon owners, and one of the more fixed costs – stock can be managed, wages can be tweaked, but rent is a consistent and constant expense.

 

While some states (like Queensland) are offering rent relief as part of their Business Grants Schemes, other states have implemented specific policies to cover this unprecedented situation for businesses.

 

However, during the latest round of lockdowns, we have not seen a national, Federal Government-led response like we saw in April of 2020. We believe that there is more that the Federal Government can, and should, be doing to support business owners through both the snap and protracted lockdowns that we are seeing across the country.

 

In NSW, if your business was unable to meet lease commitments from 13 July to 20 August 2021, due to the COVID-19 pandemic, you may be eligible for protections under the Retail and Other Commercial Leases Regulation (COVID-19) 2021 .

Under the Regulation, landlords are not able to lock out or evict eligible tenants without first going to mediation, but landlords are under no obligation to help tenants.

We encourage all salon owners to open up dialogue with their landlord about their particular business situation before missing or reducing any payments on your rent. A simple conversation can make this whole situation much easier to manage.

NSW currently has a 60 day freeze on evictions for both commercial and residential tenancy. Tenants who can’t pay their rent in full because they are impacted by the recent COVID-19 outbreak can’t be evicted between now and 11 September 2021.

The NSW Government has also introduced measures to provide relief to commercial and residential landowners, who provide a reduction in rent to a tenant who is experiencing financial distress as a result of COVID-19, including $1,500 per tenancy for those landlords who agree to reduce rent for lockdown-affected businesses. This can be a great point to bring up with your landlord when negotiating reduced rent.

We recommend salon owners specifically negotiate a fixed term for reduced rent, as well as a plan for you to work your way back to full rental payments. This may be that reduced rent is applied until the end of lockdown (whenever that may be) with a 10% increase each month out of lockdown, or return to full payments within 1 month of lockdown being eased. It’s important to stipulate that by lockdown you mean when salons are able to be open and operating again, as that may be on a different timescale to changes in lockdown laws for general residents.

 

For salons outside of lockdown areas right now, it may be worth starting a conversation with your landlord as a way to be proactive in your approach. By beginning the conversation now, you can put into place your rental reduction plan with your landlord from the moment a lockdown is announced, rather than starting negotiations once your salon has been forced to close.

 

HABA are looking for your stories, and your support, as we continue to approach government to help the Hair and Beauty Industry stay afloat during these forced lock-downs. We are calling on all members of the industry (not only HABA Members) to write to us to support our efforts to gain rent support or relief for salon owners. If we are all in it together landlords should share some of the financial burden. Simply demanding salon owners give their government support grants to the landlord before any reduction is contemplated is unacceptable.

Please send messages to info@askhaba.com.au so we can continue to lobby the government to do more for salon owners.