Vicinity Centres (Vicinity) welcomes National Cabinet’s announcement of a SME Commercial Code of Conduct and Leasing Principles During COVID-19 (the Code) for shopping centre owners and SME retailers when negotiating temporary changes to existing retail leases as a result of the business impact of COVID-19.
The Code, once given regulatory effect by each state and territory, will apply to small, medium and family retailers with annual revenue of up to $50 million who have been experiencing financial stress or hardship as a direct result of COVID-19. The Code will automatically apply where the SME tenant is eligible for the Federal Government’s JobKeeper program.
Vicinity CEO and Managing Director Grant Kelley said the Code builds on the principles put forward by the key national retail associations; the Australian Retail Association (ARA), National Retailers Association (NRA) and Pharmacy Guild of Australia (PGA), and the Shopping Centre Council of Australia (SCCA). Mr Kelley thanked them for the work that had been done on the draft SME Retail Leasing Code of Conduct and for their collaborative, timely and balanced approach to developing the principles for working together.
“We have been encouraged by the collaboration of retailers and property owners to provide unity and greater certainty for the retail industry during this unprecedented period,” Mr Kelley said.
Mr Kelley commended the Federal Government on the ‘good faith’ principles proposed to progress the foundation of the Code that landlords and SME retailers together would share, in a measured manner, the financial risk and cashflow impact of COVID-19.
“We anticipate that the Code will provide our industry with consistent guidelines to ensure we manage the business impacts of the COVID-19 crisis together with our SME retailers, through to recovery. Further, the Code provides flexibility for us to negotiate commercial and balanced outcomes with our SME retailers on a case-by-case basis to achieve fair and proportionate results.
“Along with our retail association partners and the SCCA, we welcome the opportunity for further consultation and clarification on the Code with each of the states and territories. We would expect a swift resolution that is nationally consistent and balances the needs of all stakeholders given the need for timeliness due to the current and significant impacts of COVID-19,” Mr Kelley said.
“We recognise the role we play in supporting and cooperating with industry, government, and the banks, in the development of the solution that steers us towards recovery and rebound.
“We are all part of the same retail ecosystem. We have a mutual understanding that the continued success of our industry relies upon both retailers and the critical infrastructure of shopping centres, which together make a significant contribution to the Australian economy through value and employment creation. This is especially true of our SME retailers including the family-run and sole trader businesses that make up the backbone of Australia’s retail industry,” Mr Kelley said.
“We know that our SME, family-run and sole-trader retailers may not have the necessary depth of financial support to continue to do business or endure these unprecedented circumstances and may be experiencing hardship.
“The principles of the Code complement the measures and support Vicinity has already been working through with its SME retailers to help them navigate their businesses during this uncertain period. This will take us some time and we will continue to work with our retailers on a case-by-case basis taking into consideration their individual circumstances,” Mr Kelley said.
Mr Kelley said during the past few weeks we have been working with all retailers who have been impacted by COVID-19 and are progressed in our conversations to put in place solutions and support measures tailored to their own circumstances. This includes retailers who have closed due to government restrictions as well as those that have voluntarily made the decision to close their businesses as a result of the impacts of COVID-19.
“Our first priority remains the health, safety and wellbeing of our customers, retailers, team members and the broader community, and we recognise these are unprecedented times that require leadership and collaboration from industry and government for the health of our communities and our economy,” Mr Kelley said.
For further information please contact:
Head of Corporate Communications
T +61 411 245 099
Corporate Communications Manager
T +61 447 044 215