INDEPENDENT NEWS

The Horse Has Bolted For Commercial Leasing Code Of Conduct

Published: Fri 24 Apr 2020 02:55 PM
Property Council New Zealand has expressed disappointment over a recent open letter to Prime Minister Jacinda Ardern calling for a mandated Code of Conduct for Commercial Leasing, with Property Council chief executive Leonie Freeman calling it “inflammatory and out of context”.
“It is disappointing that a group of entities that we have previously had strong partnerships with has elected to release a letter that effectively pits one sector against another. At the moment, everyone is hurting, and we have a responsibility as property and business owners to work together and share the necessary pain.
“Our concern is that the letter merely addresses a symptom of the wider disease; a lack of cashflow. These are uncertain times and people are understandably afraid of losing their livelihoods. This is true for retailers, business owners and property owners alike.
“From what we have seen, a vast majority of property owners and tenants have chosen to act responsibly, with their contractual obligations merely forming a starting point for negotiations that serve both parties. Of course, there are a handful of players on both sides who have chosen to take a staunch position, which is likely to be dealt with in a couple of months’ time when business resumes and emotions are not running as high.
“Our stance as the Property Council was to propose a support package to government several weeks ago that would have seen tenants, particularly small to medium enterprises, supported with immediate rent relief, allowing them additional assistance to keep their businesses afloat. Unfortunately, the Government elected not to pursue direct industry support at the time, which would have been the ideal stage for such support to be provided.
“There is little point in implementing a mandatory Code of Conduct now, when landlords and tenants have already started, and often completed, negotiations. The horse has bolted,” says Freeman.
“I can understand how it was tempting for these organisations to place blame, but the poor behaviour is not limited to landlords. We will only get through this period by working together and placing value on the tenant-landlord relationship.
“Neither party can exist in isolation and we need to keep this at the fore as negotiations continue over the coming weeks. The focus should now be on how we get businesses open under Alert Level 3 and eventually Alert Level 2 as this will help to solve a number of cashflow issues that many businesses are currently facing.”

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