cecra rent relief

Restaurants in Canada say CECRA rent relief not working and they need more help

It may take a lot more than rent relief to get many restaurants across Canada back on their feet, a new survey shows.

A survey conducted by Restaurants Canada shows that foodservice businesses are going to need more help from the government to ensure their survival, specifically in the form of working capital.

Surveys conducted in several provinces show that restaurants "might not have enough cash flow to successfully reopen their doors to diners."

"As the province(s) move forward with lifting emergency measures, restaurants will need more support remaining viable until they are on a path to full recovery," the report reads.

"About seven out of 10 survey respondents said they are either very or extremely worried that their business won’t have enough liquidity to pay vendors, rent and other expenses over the next three months."

"While the Canada Emergency Commercial Rent Assistance (CECRA) program might provide some restaurants with relief, rent obligations continue to be a challenge for many."

It shows that for both provinces "one out of five independent restaurant operators are dealing with a landlord who is not willing to provide rent relief, either through the CECRA program or some other arrangement."

"Fourteen per cent of independent restaurants haven’t been able to pay rent for April and nearly 20 per cent aren’t able to pay rent for May, despite not having an agreement from their landlord to postpone those payments."

Under CECRA, restaurants with rent less than $50,000 can get their rent covered by 75 per cent, but Restaurants Canada says that many are going to need help with cash flow to get back on their feet.

It's calling for further action from the government, including commercial tenant protections and rent relief, help with cash flow and rising debt levels and assistance with labour costs in addition to the Emegergency Wage Subsidy program.

Last month, Restaurants Canada reported that half of the independent restaurants don't expect to survive the pandemic and subsequent economic shutdown. Ten per cent have already permanently closed and many more are expected.

To get by and better serve their communities during this time, some restaurants have transformed themselves into grocery stores and food banks while most continue to rely on take-out and delivery orders.

According to a report by Forbes, "the Canadian restaurant industry needs major cash to last. This cash won’t come in the form of take-out, delivery, merchandise or gift certificates. It comes in the form of rent alleviation, eviction protection and support."

While many provincial economies have begun to reopen, exact dates for when restaurants can begin offering dine-in service is still unclear and not likely anytime soon.

All we know is that when restaurants finally do open, they're going to look a lot different.

Lead photo by

John de Freitas

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