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COVID-19: Key developments and considerations for real estate stakeholders

Author(s): Rod Davidge, Jordan Adler

Mar 26, 2020

Last updated March 31, 2020

Like many industries, the real estate industry has felt the effects of COVID-19. As Canadians continue to adapt to new realities, stakeholders across the real estate sector look to support both their people and business needs through these unprecedented times. In a climate that is constantly evolving and changing, this Update presents key developments and considerations to assist real estate investors, landlords, tenants and other interested parties.

 

Realty tax relief

In response to COVID-19, municipalities across Canada have begun instituting property tax relief measures in order to aid businesses. Below is a non-exhaustive summary of relief granted by municipalities that have implemented these measures. Please refer to the applicable municipality’s publications with respect to any relief provided before relying on such relief, as there may be conditions to the applicability of the relief that are not covered by the brief summaries below.

Ontario

City

Relief measure

Toronto

A 60-day grace period for property tax payments and payment penalties has been implemented as of March 16. Any pending automated withdrawals that have been scheduled within that 60-day period but not yet withdrawn have been suspended.

For property owners on the three-instalment payment plan, payments for the interim property tax bill due April 1 will be deferred until June 1.

For property owners on the 11-instalment payment plan, payments for interim 2020 instalments will be extended for a period of 60 days.

See here for more details.

Barrie

Payments for interim property tax bills will not be subject to any new late payment fees until June 30.

See here for more details.

Brampton

A five-month grace period has been granted for property tax payments and payment penalties for interim property tax bills due during the five-month period from March 18  to August 19.

See here for more details.

Caledon

Payments for the remaining interim property tax bills due in 2020 will be deferred for a period of two months.

See here for more details.

Clarington

Payments for the interim property tax bill due in April will not be subject to any late payment fees or interest for a period of 60 days.

See here for more details.

London

Payments for the interim property tax bill due March 31 will not be subject to any late payment fees or interest for a period of 60 days.

See here for more details.

Mississauga

A 90-day grace period has been granted for property tax payments for interim property tax bills due April 2 and May 7.

For property owners on monthly pre-authorized tax payments, withdrawals planned during the three-month period from April to June will be deferred for a period of 90 days.

See here for more details.

Newmarket

Payments for the interim property tax bills due March 26 and April 28 will not be subject to any late payment fees or interest. Further details are to be provided.

See here for more details.

Orangeville

A 90-day grace period for property tax payments and payment penalties has been granted.

See here for more details.

Oshawa

Payments for interim property tax bills due April 27 will not be subject to any late payment fees or interest until June 30.

See here for more details.

Ottawa

Payments for interim property tax bills due March 19 will not be subject to any late payment fees until April 15.

A property tax hardship deferral program for qualifying property owners has been created, which will extend the interim property tax and final property tax deadlines for qualifying property owners to October 30.

See here for more details.

Sudbury

Payments for the interim property tax bill due April 2 will not be subject to any late payment fees until June 4.

See here for more details.

Uxbridge

A two-month grace period has been granted for property tax payments for the interim property tax bill due in April. Payments for the first instalment of the final property tax bill due in July will be deferred until August 17.

See here for more details.

Vaughan

Payments for the interim property tax bills due March 26, April 27 and May 27 will not be subject to any late payment fees or interest until June 1.

See here for more details.

Whitby

Payments for interim property tax bills due in April will not be subject to any late payment fees or interest for a period of 60 days. Payments for the final property tax bill due in June will be deferred until July.

See here for more details. 

Windsor

Payments for the interim property tax bill due in March 2020 will not be subject to any late payment fees or interest until June 30. Payments for the interim property tax bill due April 15 will be deferred until June 30.

See here for more details.

 

Québec

City

Relief measure

Montréal

The second instalment of property taxes have been postponed for a period of one month. The new deadline for property taxes will be July 2.

See here for more details.

 

British Columbia

City

Relief measure

Vancouver

Property tax payments will be deferred for a period of 60 days.

See here for more details.

 

Alberta

The Province of Alberta announced a province-wide deferral of education property taxes for businesses for a period of six months. Premier Jason Kenney further announced that the government would be reversing the education property tax increase announced in the 2020 budget.

City

Relief measure

Calgary

Payment of the interim tax bills in respect of water, wastewater, sewer, waste, recycling and composting due during the three-month period from April to June can be deferred and paid out over the remaining six months of the year without penalty or interest.

See here for more details.

 

Landlord/tenant matters

As Canadians continue to face uncertainty, both landlords and tenants alike have been closely monitoring developments. With major Canadian banks having already stated a willingness to provide flexible solutions for mortgage payments, momentum both online and in social media has picked up, calling for legislative intervention aimed at regulating both residential and commercial leasing, in response to the COVID-19 pandemic. Below is a non-exhaustive summary of provincial legislative enactments pertaining to residential and commercial tenancies relating to the COVID-19 pandemic. Please refer to the applicable province’s publications for further details before relying on such relief, as there may be conditions to the applicability of the relief that are not covered by the brief summaries below.

Residential tenancies

Province

Relief measure

Alberta

On March 27, Alberta announced the introduction of a new protection plan to support Alberta residential tenants and landlords. Effective immediately, residential tenants cannot be evicted for non-payment of rent and/or utilities before May 1. Additionally, effective immediately, residential rents cannot increase while Alberta’s public health emergency remains in effect. Effective April 1, late fees cannot be applied to late rent payments for a period of three months and landlords and tenants are required to work together to develop payment plans while Alberta’s public health emergency remains in effect. See here for more details.

British Columbia

On March 25, British Columbia announced the introduction of a new plan aimed at supporting residential tenants and landlords through temporary rental supplements, halting evictions and freezing rents, among other actions. The new rental supplement will provide up to $500 a month per household, paid directly to landlords. The province further announced the suspension of evictions, as residential landlords may not issue a new notice to end a tenancy for any reason and has halted the enforcement of existing eviction notices issued by the Residential Tenancy Branch. Also, new residential annual rent increases have been frozen during the state of emergency. See here for more details.

Manitoba

On March 24, Manitoba announced the postponement of residential eviction hearings for non-urgent matters. Eviction orders will only be issued for matters affecting health and safety, including unlawful activities. Further, any residential rent increases scheduled to take effect April 1 have been suspended. See here for more details.

New Brunswick

On March 19, New Brunswick announced the suspension until May 31 of the right of residential landlords under section 19 of the Residential Tenancies Act to require tenants to vacate for non-payment of rent and the authority of residential tenancies officers under section 22 to evict tenants for the same reason. See here for more details.

Newfoundland and Labrador

On March 26, Newfoundland and Labrador announced that tenants of residential rental properties cannot be evicted if they have lost income resulting from COVID-19 and are not able to pay rent. See here for more details.

Nova Scotia

On March 19, Nova Scotia announced that, effective immediately, no residential tenant can be evicted because their income has been affected by COVID-19, for a period of three months. See here for more details.

Ontario

On March 19, the Landlord and Tenant Board, the tribunal in Ontario responsible for resolving disputes between residential landlords and tenants, announced the suspension of eviction orders and all hearings related to eviction applications unless the matter relates to an urgent issue such as an illegal act or a serious impairment of safety. See here for more details.

Price Edward Island

On March 17, Prince Edward Island announced that the P.E.I. Housing Corporation has suspended all residential evictions for a period of six weeks. See here for more details.

Québec

On March 21, Québec announced the suspension of any judgment by a tribunal authorizing the repossession of a dwelling or the eviction of the tenant in a dwelling, as well as the effects of any decision or any judgment ordering the eviction of a lessee or occupant of a dwelling. See here for more details.

Saskatchewan

On March 26, Saskatchewan announced the suspension of eviction hearings as a result of COVID-19. Further, applications for evictions related to missed or late rent will not be accepted and previous eviction orders for non-urgent matters will not be enforced. See here for details.

Yukon

On March 26, the Yukon adopted new regulations under the Residential Landlord and Tenant Act preventing evictions for a period of 90 days as a result of COVID-19. These regulations allow for late rental payments by residential tenants, if residents are unable to pay their rent when due. See here for more details.

 

Commercial tenancies

Province

Relief measure

New Brunswick

On March 25, New Brunswick issued a renewed and revised mandatory order providing that no landlord in relation to a commercial tenancy shall give any tenant any sort of notice to quit, re-enter or re-possess the demised premises or exercise any right of distress until May 31 for non-payment of rent that came due after March 19. See here for more details.

Nova Scotia

On March 27, Nova Scotia announced a commercial rent deferral program, encouraging landlords to defer rent payments from their commercial tenants for a period of three months. Eligible landlords could be eligible to claim losses or coverage for non-recovered rent. Landlords must register with the Department of Business by April 3. See here for more details.

 

Construction

On March 20, 2020, the Government of Ontario issued an Emergency Order (O.Reg. 73/20) under the Emergency Management and Civil Protection Act (R.S.O. 1990, c. E.9) suspending limitation periods and laws that establish a period of time in which a step must be taken in any proceeding in Ontario, for the duration of the COVID-19 emergency. See here for a discussion on the impact on construction lien periods.

Market developments

  1. On March 26, 2020, Greenrock Real Estate Advisors (GREA) announced the implementation of a series of initiatives to assist its residents and community members amid the COVID-19 crisis. The initiative includes the following relief measures: a donation of $300,000 towards local charitable organizations, creating a rent assistance program for residents, allowing residents to use their last month’s deposit as a credit towards rent payments, the deferral of rent increases, gift cards to grocery stores, as well as others. See here for more details.
  2. On March 23, 2020, the Government of Ontario ordered the mandatory closure of all non-essential workplaces for an initial 14-day period, effective Tuesday, March 24, 2020, at 11:59 p.m. Similarly, the Government of Québec ordered the closing of all non-essential stores and services, effective as of March 25, 2020, until April 13, 2020. In the case of Ontario, the list of exceptions to this order includes construction projects and services associated with the healthcare sector; construction projects and services required to ensure safe and reliable operations of critical provincial infrastructure; construction work and services, including demolition services, in the industrial, commercial, institutional and residential sectors; and construction work and services that support health and safety environmental rehabilitation projects. The Québec exceptions for the construction sector are much narrower and include construction firms for emergency dispatching or security purposes; electricians, plumbers and other trades for emergency services; and rental equipment. In addition, the Québec exceptions also include construction, maintenance, and the maintenance of essential activities related to public and private infrastructure that may pose a threat to public health and safety. For further information on what constitutes a service as “essential,” see here. For further information on construction projects and COVID-19, see here.
  3. On March 23, 2020, SmartCentres REIT (SRU-UN-T) announced it is offering Canadian governments and health authorities up to 1-million square feet of rent-free space in its 200 shopping centres across the country to assist in their COVID-19 support efforts. See here for more details.
  4. On March 23, 2020, First Capital REIT (FCR-UN-T) announced the introduction of the FCR Small Business Support Program, a $30-million program to bring immediate relief to small business owners in the company’s portfolio that are affected by COVID-19. Qualifying small businesses may defer a portion or all of their rent for a time period initially set at two months commencing April 1, 2020. See here for more details.
  5. On March 20, 2020, the Government of Ontario issued an Emergency Order (O.Reg. 73/20) (the Emergency Order) under the Emergency Management and Civil Protection Act (R.S.O. 1990, c. E.9). The Emergency Order is retroactive to March 16, 2020, and will affect proceedings before the Local Planning Appeal Tribunal (LPAT) in the following ways: all timelines within which any step must be taken in a proceeding before the LPAT are suspended for the duration of the emergency, the LPAT will not schedule any hearings while the Emergency Order is in effect, and all hearing events scheduled in the LPAT between March 16, 2020, and June 30, 2020, will be adjourned to a future date. See here for more details.
  6. On March 20, 2020, Canada Life Assurance Company (Canada Life) announced the temporary suspension of contributions, transfers and redemptions for its Canadian real estate investment funds in light of COVID-19. The impacted funds include the Great-West Life Canadian Real Estate Investment Fund No. 1, the London Life Real Estate Fund 2.17G, the London Life Real Estate Fund 5.191G and the Canada Life Real Estate Fund (GWLRA) SF353. Correspondingly, on March 23, 2020, Canada Life, alongside IGM Financial and Power Corporation of Canada, announced a $1-million joint contribution to support local and national foodbanks. See here for more details.
  7. On March 20, 2020, Minto Apartments announced new procedures to support residential apartment tenants, by offering a rental deferral program to support eligible residents unable to pay their rent due to COVID-19, as well as a rent freeze for all residents for a period of three months. See here for more details.
  8. On March 19, 2020, Ivanhoé Cambridge announced the introduction of support measures to the Québec economy in light of COVID-19, by granting a deferral of rent payable by tenants of its retail properties in Québec until a later date to be identified in the future. See here for more details.
  9. On March 17, 2020, RioCan Real Estate Investment Trust (REI.UN) announced tenant support measures in response to COVID-19, by a 60-day, interest-free rent deferral for certain independent commercial tenants. See here for more details.

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