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Montreal small businesses at a dangerous tipping point despite loans, they say
MONTREAL -- Montreal small businesses are in dire straits, despite a federal rent subsidy—because they say their landlords aren’t applying for it.
“The future [is] very uncertain,” said Tony Ouba, who was forced to close his franchise in the Amir restaurant chain recently after sales dropped 80 per cent during the pandemic.
His landlord deferred rent for three months, Ouba said, but it still wouldn’t work out financially.
The CEO of the Amir chain says that’s the new norm, with almost all his franchisees struggling. Even an emergency $40,000 loan from the government can’t necessarily save people like them, said Joseph Eid, the CEO of the Amir Restaurants chain.
“Insurance, hydro, gas, city taxes and everything else to pay—it’s not going to be enough for the person to stay open or to survive,” he said.
The federal rent loan, called the CECRA, will cover 75 per cent of a small business’ rent for up to three months, leaving the business to pay the other 25 per cent.
But the onus is on the landlord to apply, and many aren’t, small business owners say. The landlords often seem to prefer to send out eviction notices than to extend the uncertainty, their tenants say.
That’s not necessarily a surprise, if you see it from the landlords’ perspectives, says Laura Jones of the Canadian Federation of Independent Business.
“They’ve not seen any relief, and then they’rebeing asked to pass relief onto their tenants—which many of them want to do, but they can be scared about their own future,” Jones said.
Overall, the options presented to small business owners have also been a bureaucratic “nightmare,” she said.
A new association called “Save Small Businesses,” with 40,000 members, recently surveyed some of those members and found that only two in 10 said their landlords have been willing to apply for the CECRA rent loan, said Michael Smith, a spokesperson for it.
“Without rent relief, those businesses are not going to be able to open, and we could lose more than half of small businesses across the country as a result of it,” said Smith.
One Montreal business owner said the solution is simple: take the loan money that’s already available and put it directly in the hands of the business owners.
“I’m not the only business that their landlord is not taking part in this program,” said Chrysanthi Diplas, who owns a hair salon.
Some say that a solution could also rest with the provinces. Some of the Maritime provinces have temporarily banned commercial evictions, and Quebec Premier François Legault says Quebec is considering a relief program of its own.