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Commercial Leases Need To Be Regulated

The New Zealand exercise industry is calling on the government to step in and regulate the commercial leases, just as they have done with residential tenancies.

ExerciseNZ chief executive Richard Beddie says they have surveyed their members and the early data shows most landlords are playing ball, but that more than one in 10 refuse to give any rebates or reduction.

“We are even aware of one facility that the landlord put the rent up after Level 4 was put in place. These type of behaviour is reprehensible,” Beddie says."

There are about 800 gyms and studios in the country and about 90 percent operate out of leased buildings.

“For our industry, like many others, rent is one of the biggest costs and based on our research we believe about 10 percent of landlords aren’t working with tenants who are increasingly facing the likelihood of their gym or studio businesses going under during the covid-19 pandemic lockdown.

“We are appealing to the government to adopt similar law changes as residential rent tenancies.

“It needs to balance both the needs of the tenant and landlord. What Australia did by allowing up to 50 percent rent deferral, to be amortised over the next 12 months, is the right kind of balance here for New Zealand.

“This way, landlords are still paid full rent, but the tenant gets a cashflow reprieve in the medium term to help them through the coronavirus shutdown and the re-normalising phase.

“As most gyms will still be closed during alert level three, and significantly restricted even during level two, it’s important that landlords and tenants work together to get through this.

“The phrase ‘we are in this together’ has been used by many, and never has this been more appropriate and applicable than now,” Beddie says.

The government has placed an immediate freeze on rent increases and is supporting New Zealanders to stay in their rental properties with a six month freeze on residential rent increases.

Beddie says measures to protect commercial tenancies will protect the interests of tenants, landlords and the wider community during this unprecedented time.

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