A Government of Canada program to lower rent by 75 per cent for small businesses that have been affected by COVID-19.
Latest Update - October 9th, 2020: The Government of Canada announced the Canada Emergency Rent Subsidy (CERS) benefit to pick up where CECRA left off.
What is the Canada Emergency Commercial Rent Assistance (CECRA)?
The Canada Emergency Commercial Rent Assistance (CECRA) for small businesses lowers rent by 75 per cent for small businesses that have been affected by COVID-19.
CECRA provides forgivable loans to qualifying commercial property owners, whether they have a mortgage on their property or not. The loans cover 50 per cent of monthly rent payments that are payable by eligible small business tenants who are experiencing financial hardship during April, May, June, July, August, and September. The loan covers 50 percent of rent, the landlord waives 25 per cent, and the tenant pays the remaining 25 per cent.
The loans will be forgiven if the qualifying property owner agrees to reduce their small business tenants’ rent by at least 75 per cent under a rent reduction agreement, which will include a term not to evict the tenant while the agreement is in place. The small business tenant would agree to cover the remainder, up to 25 per cent of the rent.
Opt-in applications for the July, August, and September CECRA extensions for previous applicants are open until October 30, 2020. Apply online.
Who is Eligible?
To qualify for CECRA, the property owner must meet the following requirements:
- You own property that generates rental revenue from commercial property located in Canada
- You are the property owner of the commercial property where the impacted small business tenants are located
- You have entered or will enter into a rent reduction agreement for the period of April, May, June, July, August, and September 2020, that will reduce impacted small business tenant’s rent by at least 75 per cent
- Your rent reduction agreement with impacted tenants includes a moratorium on eviction for the period duration of CECRA
What Defines an Impacted Small Business Tenant?
Impacted small business tenants are businesses, including non-profit and charitable organizations, that:
- Pay no more than $50,000 in monthly gross rent per location (as defined by a valid and enforceable lease agreement)
- Generate no more than $20 million in gross annual revenues, calculated on a consolidated basis (at the ultimate parent level, based on the existing accounting practices of the small business)
- Have temporarily ceased operations (i.e. generating no revenues), or has experienced at least a 70% decline in pre-COVID-19 revenues
Please Note: When measuring revenue loss, small businesses can compare revenues in April, May and June of 2020 to that of the same month of 2019. Businesses that commenced operations after June 30, 2019 can also use an average of their revenues earned in January and February of 2020.
- CECRA provides forgivable loans to qualifying commercial property owners, whether they have a mortgage on their property or not.
- The loans cover 50 per cent of monthly rent payments that are payable by eligible small business tenants who are experiencing financial hardship during April, May, June, July, August, and September.
- The loans will be forgiven if the qualifying property owner agrees to reduce the small business tenants’ rent by at least 75 per cent under a rent reduction agreement, which will include a term not to evict the tenant while the agreement is in place. The small business tenant would cover the remainder, up to 25 per cent of the rent.
- Eligible small business tenants are businesses that are paying less than $50,000 per month in gross rent in a given location, with annual revenues of less than $20 million (at the ultimate parent level), and who have experienced at least a 70 per cent drop in pre-COVID-19 revenues on average for April, May, and June.
- Those who qualified for CECRA based on existing program parameters will be able to apply soon for the additional relief for September based on having at least a 70 per cent revenue decline for April, May and June, without reassessing whether they continue to have at least a 70 per cent revenue decline in July, August, or September. Both existing applicants to the CECRA and new applicants are able to opt for the September rent reduction.
- New applicants have until September 30th, 2020 to apply.
- If you have been previously approved, you must also opt in for the July, August, and September extensions by October 30th, 2020.
- Canada Mortgage and Housing Corporation - CECRA Resource Page
- CECRA Quick Reference Guide
- Canada Mortgage and Housing Corporation- FAQ's
- Tenant or Sub-tenant’s Attestation (sample PDF)
- Property Owner’s Attestation (sample PDF)
- Rent Reduction Agreement (sample PDF)
- Forgivable Loan Agreement (sample PDF)
Frequently Asked Questions About CECRA
What if my landlord refuses to apply?
Unfortunately, the program is participatory for landlords, and it is ultimately their choice to apply. Look at the CECRA website for content you could use to try to convince them. Consider other other funding options, such as CEBA or RRRF and CEWS.
Can my landlord evict me?
Tenants were protected from eviction for the duration of CECRA, as long they paid the minimum 25 per cent of rent. The ban on commercial evictions for tenants in B.C. who qualify for CECRA is no longer in affect, as of October 1st, 2020.
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