The chief executive of the Canadian Imperial Bank of Commerce is stressing the need to help residential and commercial landlords and tenants get through the coronavirus crisis, including by ensuring renters also benefit from relief being given to owners.
After airlines and energy firms, the next area of focus should be “how do we help landlords and tenants, both on the personal and on the commercial front, deal with this as well,” Victor Dodig told the Post on Wednesday.
Tenants are looking for relief and landlords are offering it, but “it’s not a consistent offering,” the CIBC CEO said.
“And obviously, landlords have their own obligations as well,” he added. “So that’s going to be another area, I think, of focus that we’re all going to have to put our mind against.”
Dodig said he had spoken to a number of CEOs of real estate investment trusts who had taken it upon themselves to ensure they were working with their tenants, particularly the smaller retail ones. Still, the CIBC CEO stressed the need to get the message out and ensure there is a “trickle down” of assistance, from the banks allowing property owners to defer loan payments, to owners passing savings from those deferrals on to tenants.
“I’m sure the government’s thinking about this as another area, because you do hear a lot of talk around the landlord-tenant relationship and what can be done to alleviate the issues there,” the CIBC CEO said.
Canada’s banks have been prodded by the federal government to ease the burden on customers, and the banks have responded by allowing for the deferral of loan payments, among other things. However, both residential and commercial renters have had to hammer out deals with their landlords, who may not feel the same sense of duty or financial stability as the banks.
On March 30, for instance, the CEO of Tim Hortons-owner Restaurant Brands International Inc. published an open letter that said they were contacting their North American landlords to obtain further assistance that could be passed along to restaurant owners. Others may not be so lucky: the Canadian Federation of Independent Business found recently that seven per cent of its rent-paying members could not pay their April rent in full and did not have an agreement to defer payment.
Some provinces have banned evictions for the time being and Canada Mortgage and Housing Corp. has said it is exploring potential relief measures for renters as well. So far, though, renters have not been given the same sort of attention from the federal government that’s been paid to property owners, despite facing cash crunches caused by the coronavirus pandemic.
While speaking to the Post, Dodig recalled a client who owned a four-unit rental and who told him they would pass deferred payments on to their tenants.
“And that’s the way the system should work,” the CIBC CEO said. “That reliance on trickle-down, it can be legislated, or it can be through the goodness of human beings. And what I’m seeing is the goodness of human beings become an overwhelming factor in all of this.”