The Canada Mortgage Housing Corporation (CMHC) has announced that the online application portal for the Canada Emergency Commercial Rent Assistance (CECRA) program for small businesses will open on May 25, 2020.  Furthermore, it has provided additional details about the program and the application process.  The full details regarding the program and the application process can be found here.

The application process will require the following documents:

  • Forgivable Loan Agreement
  • Tenant/Subtenant Attestation (confirming tenant/subtenant eligibility requirements)
  • Landlord Attestation (confirming landlord eligibility requirements)
  • Rent Reduction Agreement

The CMHC has provided examples of these documents on their website.  It should be noted that these documents are for illustrative purposes only.  The final versions will be made available through the application portal when it opens.

Given the scale of the economic fallout from the COVID-19 pandemic, the CMHC is expecting a large volume of applications on May 25.  To help administer the program, the CMHC has engaged First Canadian Title (FCT) and MCAP (Canada’s largest independent mortgage financing company).  As such, applicants may be contacted by MCAP or FCT throughout the validation and funding process.

The CMHC has also provided more nuance to their previous statement that CECRA would not apply to any properties owned, in part or fully, by the federal, provincial or municipal governments.  They announced exceptions to this blanket statement if:

  • the property owner is a First Nation or an Indigenous organization or government ‎which is the lessee of the property pursuant to a ground lease or similar long-term ‎lease from such government to administer the property;
  • the property owner is the lessee of the property pursuant to a ground lease or ‎similar long-term lease from such government to operate the property (such as a ‎lease to an airport)‎;
  • the property owner is a crown corporation with limited appropriations designated ‎as eligible for the CECRA by CMHC; and
  • for greater certainty, the property owner is a post-secondary institution, hospital, ‎or pension fund.

It is important to note that if your business is not eligible for CECRA, the federal government has other support programs for businesses and individuals.  More information can be found here.

Furthermore, if you are not a commercial property owner, mortgage payment deferral may be the best option for you.  More information can be found here.

Landlords and tenants who have questions about CECRA and its implications for their business can contact Alon Segev at [email protected].

Disclaimer

The above blog post is provided for informational purposes only and has not been tailored to your specific circumstances. This blog post does not constitute legal advice or other professional advice and may not be relied upon as such.