No Need For a Mortgage – Update to the Canada Emergency Commercial Rent Assistance (“CECRA”) Program

Scrutinized criteria regarding the eligibility of the CECRA Program appears to have been subtly addressed in recent days.  The Canada Mortgage and Housing Corporation (“CMHC”) – the entity charged with administering the Program – had previously published criteria for eligible commercial landlords and tenants on their website. Among those conditions stood the requirement for the commercial property (which housed the affected commercial tenant) to have been used to secure a mortgage loan.

Previously, CMHC’s webpage contained a footnote next to this requirement with the following:

For those property owners who do not have a mortgage, an alternative mechanism will be implemented. Further information will be outlined in the near future.”

This prerequisite left small business owners concerned who would otherwise benefit from the CECRA Program but were ineligible simply because their particular landlord was not a mortgagor. The federal government had vowed to work to fix this gap; however, it now appears this requirement has been abandoned altogether.

As of today, the same aforementioned CMHC webpage omits the mortgage requirement previously listed and instead contains the following as a FAQ:

“My property owner doesn’t have a mortgage — would we still be eligible for the program?

Yes. CECRA for small businesses is available to property owners who do not hold a mortgage.”
[emphasis added]

Nonetheless, the other terms of the CECRA Program, as reported in our previous article, remain unaffected and in place. As of the date of this article, applications for the CECRA Program are still forthcoming although they were announced to become available in “the second half of May 2020.”

Lastly, the CMHC clarified that the forgivable loans granted to eligible commercial property owners shall be forgiven on December 31, 2020. For questions regarding the CECRA Program or other issues with your lease please contact us:

Jennifer M. Williams, Shareholder
(604) 691-7512

Tony R. Anderson
(604) 691-7528

Lucky D. Johal
(604) 691-7541

Categories: COVID-19, Real Estate