May 5, 2020

Open Letter to Commercial Landlords in Ward 13 on Saving Small Businesses

As many of you are aware, Ward 13 - Toronto Centre, is the heart of Toronto’s downtown.  We are home to some of Canada’s most iconic business districts and small businesses, from Canada’s largest gay village to the Financial District, to the re-invigorated historical districts such as Yonge Street, Corktown, St Lawrence Market and more.

According to the recent Save Small Business survey, 70% of small businesses will default on their commercial rent in May as a result of the impacts of COVID-19. These numbers are confirmed in a local survey conducted by businesses in the Corktown neighbourhood. They have seen that the mandatory provincial shutdown for non-essential businesses has led to greater than an 80% loss in revenue for 80% of businesses in Corktown. 

Small businesses employ millions of Canadians and serve as the financial heart and spine of every community and its mainstreet. Like you, I have seen recently boarded up shops across the city, including those in our local neighbourhoods, as residents are taking their duty to stay home and practice physical distancing seriously. 

However, it is also a scary foreshadowing of what could be a permanent condition on our mainstreets once the physical distancing measures have been lifted, if we don’t take quick and serious measures to help small businesses survive. Some of the boarded up storefronts or soon to be closed locations belong to your tenants. They have poured their sweat and tears into building a business that can support local residents, their employees, neighbourhoods and families. In the best of times, you work in financial partnership with them and your success is tied directly to theirs. 

COVID-19 is a global pandemic unlike any other and it has radically changed the way we live, work, play, study and invest. The lockdown-induced recession that grips Canada requires each of us to do our part in supporting one another. Our ecology, social and economic well-being are more entwined than ever before. We need each other to survive.

This is why I am disappointed to learn that Commercial Landlords in our neighbourhoods, including a significant number in the Church-Wellesley Village, are not only refusing to apply for the Canada Emergency Commercial Rent Assistance (CECRA) program but also moving to evict the tenants. For every iconic venue that closes in the Village, we lose an important LGBTQ2S+ business and cultural space. We can not allow this to happen.

Although CECRA is not perfect, it is available exclusively to you as landlords. The economic and cultural vibrancy of the City of Toronto is relying on you to apply for,  and pass along the financial assistance to your struggling tenants. It’s a straightforward program with the Government of Canada paying 50% of the rent through a forgivable loan, your tenant will pay 25% and you as the landlord forgo the final 25%. By all calculations, 75% payable is far better than nothing - which is exactly what you will get if the tenants are forced to close their doors permanently. 

You are not in this alone. To assist residents, property owners and business operators, the City of Toronto has deferred the payment of property taxes and utility bills. Further to this, we have established the BusinessTO Support Centre to exclusively provide support to businesses navigating the different government financial programs made available during the COVID-19 emergency. We have professional staff on standby ready to help you fill out the application forms for assistance, including CECRA. 

There is no excuse for you to sit idly by, unreasonably demand full rent from your tenants and then start the eviction process. Doing nothing to help them and then legally threatening the tenants is an act of selfish recklessness and the economic harm will not only befall your tenants. If your storefront property becomes vacant as do the adjacent properties, then you have enabled your own neighbourhood decay and property devaluation.

Commercial vacancies will become the new normal if landlords don’t work with their tenants to survive the economic fallout of the pandemic together. If you refuse to apply for the government programs designed to help you and your tenants, and you evict your tenants for non-payment of rent during COVID-19, you will not easily recover. In a global recession, there will not be eager new tenants flushed with cash to pay you three times more rent than your property is worth. 

This is not going to happen. The community will name and shame you for being heartless when you could have acted with responsible compassion and good corporate citizenship.

We understand that these are difficult times for everyone which is exactly why we must work together to survive the financial destruction brought on by COVID-19. It’s the only way we can get to the other side safely. Without your cooperation, in large part, our local businesses and mainstreets will be obliterated. 

We are counting on you, please do not let us down.

Kristyn Wong-Tam

Lisa Hoffman

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