The greater challenge will be the significant lag in commercial rents
Commercial landlords will have to grapple with multiple challenges over the next few months, but eviction bans are not likely to affect them noticeably, according to Colliers Canada.
“There aren’t a lot of new tenants out there so landlords aren’t running out there trying to evict people,” said John Duda, president of real estate management services for Colliers Canada. “It’s a last resort. It’s always the last resort.”
Duda said that the bans, which have been imposed by several provinces since the start of June, are unlikely to help in the long run.
“What we think this actually does do, is the tenants who were doing badly before [COVID-19], and are simply doing way worse now, it means the inevitable is just going to get delayed,” Duda told Yahoo Finance Canada. “At the end of the day, the landlords want people to be paying rent.”
The bigger struggle will be in the realm of rent collection, which has been hammered by the government-mandated COVID-19 lockdowns.
A separate Colliers report indicated that collection will not immediately resume at its pre-outbreak pace even after the economy has restarted.
The study “anticipates a lag of six weeks between reopening dates and an uptick in collections due to businesses and consumers taking time to assess the situation as conditions start to return to normal,” Colliers said. “Rent collection deteriorated by 1% in March, 10% in April and 13% in May from February’s baseline.”
