Retailers get breathing room as economy approaches lockdown

Thousands of small shop owners in SA shopping malls will be able to able to apply for rental holidays and avoid evictions, according to new regulations meant to give small businesses a fighting chance ahead of a three-week lockdown to contain the spread of Covid-19.

SA is heading into a nationwide lockdown from Friday morning, a move that will shut businesses from restaurants to cinemas and gyms until mid-April as part of efforts to fight the rapidly spreading coronavirus and ensure the country’s creaking healthcare infrastructure is not overwhelmed.

As part of a range of measures to soften the economic blows of the lockdown, the government issued new exemptions to its existing laws on Wednesday that allow distressed tenants to request a relief from their landlords without being evicted, and for landlord to help a tenant without breaching competition rules

“The purpose of the exemption is to strengthen the government’s programmes designed to fight Covid-19, after having declared a national state of disaster,” trade and industry minister Ebrahim Patel said in the government gazette.

These include promoting “concerted conduct to prevent an escalation of the national disaster and to alleviate, contain and minimise the economic and social effects of the national disaster”.

The move will enable the retail property sector to minimise the negative effects on the ability of designated retail tenants, including small independent retailers, to manage their finances during the national disaster and be in a position to continue normal operations beyond it.

The regulations also enable landlords to give assistance to certain tenants and not to others, which could have been seen as being anti-competitive in the past.

CEO of the SA Property Owners Association (Sapoa), which represents commercial landlords, Neil Gopal said the regulations had the economy’s best interests at heart and they gave landlords and tenants options.

“These are unprecedented times that call for more than just normal business practices. Shopping centres are key to the normal functioning of our communities. Unlike developed countries, SA shopping centres form the very fabric of our society and of the very network of SA societal needs,” Gopal said.

These needs include the provision of basic requirements such as food, water, clothing stores, banking, accessing of social grants, pharmacies, medical practices, post offices, cellphone shops, fuel stations, and are run by small-, medium, and micro-sized enterprises and larger retail groups alike.

andersona@businesslive.co.za