Covid-19 News Updates

WOTSO to benefit from BlackWall rent deferrals

BlackWall Property Trust (ASX: BWR) has announced it will be offering rent abatements or deferrals to tenants suffering due to the Covid-19 crisis, with co-working provider WOTSO WorkSpace set to be one of the key beneficiaries.

The trust has put forward a strategy to give its tenants the best chance of survival while limiting the impact on its property owners.

"Our approach is to provide rent abatements for all small businesses where economic survival is at risk and to offer rent deferrals to those tenants needing cash flow support," the group said.

"Accordingly, we have advised the 10 coffee shops and restaurants in our portfolio  that no rent will be payable for April.

"We will review this on a monthly basis until the crisis passes. Some other small or vulnerable tenants have also been provided with rent abatements while others have been offered a mix of rent abatements and rent deferrals."

The company noted it will look to its larger and more secure tenants to meet their commitments during this time so that it can support those that are more vulnerable.

WOTSO is a significant tenant in BlackWall's portfolio and is expected to have its cashflow "severely impacted".

"WOTSO has offered all members the opportunity to suspend their memberships at  this  time with offices and or desks preserved  for when members return.

"WOTSO rents space to some essential services so, as long as the law permits, WOTSO will remain open regardless of the number of members on site.

"Rent for all WOTSO facilities in our portfolio will be deferred subject to review on a monthly basis."

BlackWall joint managing director and COO Jess Glew tells Business News Australia that of the 17 WOTSO sites Australia-wide, 10 are within BlackWall properties including eight within its property trust and two within the broader group.

She says WOTSO normally accounts for around 30 per cent of the trust's rental revenue. 

BWR explains it has adequate cash reserves, but to be prepared in uncertain times the trust has arranged an additional debt  facility for the group which is being drawn today.

"BWR will then have $22 million cash on hand and will continue to retain significant capacity to expand with gearing at 24 per cent (up from 20 per cent at 31 December 2019)."

Updated at 12:29pm AEDT on 30 March 2020.

Australian banks extend loan deferrals to 30,000 more businesses

More than 30,000 Australian businesses can now access the six-month loan repayment deferral program after the Australian Banking Association (ABA) decided to extend the relief.

Businesses with total loan facilities of up to $10 million (up from the $3 million small business threshold initially announced on 20 March 2020) will now be able to defer repayments for loans attached to their businesses for six months.

The ABA's support now extends to 98 per cent of all businesses with a loan from an Australian bank, and will apply to an additional $100 billion of business loans. This will bring the combined total of loan repayments deferred by Australian banks to $250 billion.

During this period banks have also agreed to not enforce business loans for non-financial breaches of the loan contract (such as changes in valuations). 

The new measures will apply in all sectors of the economy, and on an opt-in basis, under the conditions that: 

• For commercial property landlords, they provide an undertaking to the bank that for the period of the interest capitalisation, they will not terminate leases or evict current tenants for rent arrears as a result of COVID19;
• the customer has advised that its business is affected by COVID-19; 
• the customer was current in terms of existing facilities 90 days prior to applying; and
• interest is capitalised (meaning either the term of the loan is extended or payments are increased after the deferral period).

"As this crisis has deepened and more businesses are affected we are building on the Small Business Relief package to ensure more businesses are given a lifeline to help them survive through the coronavirus pandemic," says ABA CEO Anna Bligh.

"Banks are expanding their support to an extra 30,000 thousand businesses by raising the threshold of those who qualify for the six month deferral of loan repayments from $3 million to up to $10 million in total loan facilities. 

"This will help protect many more thousands of small businesses from being evicted if they are struggling to pay the rent as it covers approximately 90% of commercial property owners who have loans with an Australian bank."

Updated at 11:30AM AEDT on 30 March 2020.

PM announces moratorium on evictions, gatherings restricted to two persons only

Australian commercial and residential tenants impacted by Covid-19 have been given a six month reprieve as the country's total number of confirmed coronavirus cases creeps closer to 4,000.

The National Cabinet has agreed to a moratorium on evictions over the next six months for both commercial and residential tenancies in financial distress who are unable to meet their commitments due to the impact of coronavirus.

The Government has encouraged landlords and financial institutions to collaborate with tenants on coming to an agreement to ensure businesses can make it to the other side of the coronavirus crisis.

A common set of principles, endorsed by the Federal and State Treasurers to guide these discussions includes:

• A short term, temporary moratorium on eviction for non-payment of rent to be applied across commercial tenancies impacted by severe rental distress due to coronavirus;
• tenants and landlords are encouraged to agree on rent relief or temporary amendments to the lease;
• the reduction or waiver of rental payment for a defined period for impacted tenants;
• the ability for tenants to terminate leases and/or seek mediation or conciliation on the grounds of financial distress;
• commercial property owners should ensure that any benefits received in respect of their properties should also benefit their tenants in proportion to the economic impact caused by coronavirus;
• landlords and tenants not significantly affected by coronavirus are expected to honour their lease and rental agreements; and
• cost-sharing or deferral of losses between landlords and tenants, with Commonwealth, state and territory governments, local government and financial institutions to consider mechanisms to provide assistance.

The moratorium decision comes ahead of yet another stimulus package, expected to be announced by the Federal Government today.

As reported by the ABC, the scheme will include a new wage subsidy for businesses and workers impacted by the coronavirus. Businesses are expected to be paid up to $1,500 per fortnight, per employee, for the next six months.

Federal Treasurer Josh Frydenberg says the package will be an Australian-style system and will not mirror the approach taken by the United Kingdom whereby the Government is paying 80 per cent of businesses' wage bills. 

In addition the National Cabinet has restricted indoor and outdoor public gatherings yet again to two persons only.

Exceptions to this limit include:

• People of the same household going out together (who together are able to meet with one person maximum);
• Funerals (a maximum of 10 people);
• Wedding (a maximum of 5 people);
• Family units.

Playgrounds, skate parks and outside gyms in public places will be closed while bootcamps will be reduced to two persons, including the trainer.

In Australia there are now 3,966 confirmed cases of Covid-19, with 1,791 in NSW, 769 in VIC, 656 in QLD, 311 in WA, 287 in SA, 77 in ACT, 61 in TAS, and 14 in NT.

$1.1 billion to supporting mental health and domestic violence services

The Federal Government has also announced $1.1 billion will be given to mental health, Medicare and domestic violence services.

"As we battle coronavirus on both the health and economic fronts with significant support packages in place and more to come, I am very aware many Australians are understandably anxious, stressed and fearful about the impacts of coronavirus and what it brings," said  Prime Minister Scott Morrison.

 
"We are focused on saving lives and saving livelihoods and this new support package will provide much needed care and help to so many Australians facing hardship at no fault of their own.

"We will get through this crisis by staying together, by supporting each other and ensuring that no Australian, even though we have to be isolated, should have to go through this alone."

Medicare-subsidised telehealth services for all Australians will be expanded by a $669 million cash injection to further encourage the population to stay home as much as possible.

The Federal Government hopes the funding will take the pressure off hospitals and emergency departments, and allow people to access essential health services at home.

Domestic violence services like 1800RESPECT and Mensline Australia will receive $150 million.

According to the Federal Government Google is seeing the highest magnitude of searches for domestic violence help that they have seen in the past five years with an increase of 75 per cent and some services are already reporting an increase in demand.

Updated at 9.58AM AEDT on 30 March 2020.

US stimulus package includes US$350 billion for job restoration and retention

US President Donald Trump passed an historic US$2.2 trillion (AUD$3.56 trillion) stimulus package on Friday night after it was passed by the House, including hundreds of billions of dollars for keeping Americans in jobs and supporting the unemployed.

Under the CARES Act $350 billion (AUD$566 billion) has been slated for job restoration and retention, while loan forgiveness will be available for those businesses that continue paying their workers.

The president highlighted US$300 billion (AUD485 billion) in direct cash payments would be made to citizens earning less than US$99,000 (AUD$160,206) per year.

This translates to US$3,400 (AUD$5,502) for a typical family of four.

The act also entails approximately US$250 billion (AUD$404 billion) in expanded unemployment benefits, which will mean the average worker who has lost their job will receive four full monthly salaries.

NBC News reports Trump thanked Republicans and Democrats for "coming together and putting America first".

"We got hit by the invisible enemy and we got hit hard. I think we are going to have a tremendous rebound," he was quoted as saying.

Under the financial relief bill signed on Friday, "the average worker who has lost his or her job will receive 100 percent of their salary for up to four full months." pic.twitter.com/9xevBDJj1T

The White House (@WhiteHouse) March 29, 2020

There are now 140,886 confirmed cases of Covid-19 and 2,436 deaths from the virus in the United States, of which more than 1,000 have been in New York State. 

Dr Anthony Fauci, who is one of the heads of the White House Coronavirus Task Force, has warned the virus could end up killing up to 200,000 Americans. 

The president has also extended social distancing-related restrictions will be extended across the country until at least 30 April.

Updated at 11:27am AEDT on 30 March 2020.

Rex rescued by $198 million government assistance package

Australia's regional airlines will be kept in the sky after the Federal Government announced a $198 million Regional Air Network Assistance Package.

The new funding brings the total amount of money committed to the Australian aviation industry to $1 billion and will ensure regional airlines can continue to deliver critical services during the Covid-19 crisis.

The move follows a decision from the Australian Competition and Consumer Commission (ACCC) allowing Regional Express (ASX: REX) to coordinate flight schedules on 10 critical regional routes with Virgin Australia (ASX: VAH) and Qantas Airways (ASX:QAN).

Prior to the competition watchdog's interim ruling, which will enable the three carriers to share revenue from providing services on the routes, Rex had announced it would be cutting all passenger air services (except for those within Queensland).

The company says just before the Federal Government's announcement it had been preparing a media release to announce the total shutdown of its network and the standing down of 90 per cent of its staff. The company will now be able to continue operations in almost its entire network of 59 destinations and in the next two days will be presenting a new national network schedule.

Because of the package around 30 to 40 per cent of Rex's staff will be able to keep working during the downturn. 

"This package guarantees core routes for domestic air freight will remain open and essential workers remain employed, while providing vital financial support for airlines servicing regional and remote locations," said Deputy Prime Minister and Minister for Infrastructure, Transport and Regional Development Michael McCormack.

"More than 100 regional and remote airports received a scheduled passenger service last month and this funding will be welcome news for the aviation workforce and the broader communities these services support.

"The funding will ensure regional communities benefit from an ongoing airline service by underwriting airlines' operating costs on selected routes."

An additional $100 million is available to provide direct financial support to smaller regional airlines during this unprecedented downturn in aviation activity should it be needed.

Rex has welcomed the support package which it says will ensure critical and essential aviation services continue during the "worst operating conditions the industustry has ever seen".

"This meaningful assistance package not only seeks to keep essential air services going, but also tries to prevent the existing regional aviation providers from collapsing," says Rex deputy chairman John Sharp.

"With this assistance package, regional Australia can be sure that all previously sustainable regional operators will be able to spring back into business if the crisis dies down within the next six to nine months. With the network of regional aviation operators intact, not only will thousands of jobs be saved but regional communities can retain a minimum of vital air links which can be quickly expanded to assist the regional communities in their rebuilding efforts after the crisis."

Updated at 9.38am AEDT on 30 March 2020.

Myer stores closed, 10,000 staff stood down

Department store Myer (ASX: MYR) is the latest retailer to shut down in the face of strict gathering restrictions and government advice regarding Covid-19.

To protect the wellbeing of customers, team members and the broader community, Myer will close all stores from the close of business on Sunday 29 March for an initial period of four weeks until 27 April 2020.

Myer's online business will remain operational during the period and the company has reduced the threshold for free delivery to $49 per order.

Because of the closures 10,000 Myer team members across the group's store network and support staff will be stood down.

Staff will not be paid during the four-week closure period, but full time and part time members will be given access to their annual leave and long service leave entitlements in addition to government financial support measures.

A small team working in business-critical roles will be kept on to undertake essential work and to support the online store. These staff will be operating on 80 per cent of their normal salaries and contracted hours.

"The decision to temporarily close all Myer stores and stand down so many loyal and dedicated team members is one of the toughest decisions this Company has faced in its 120 years of operation," says Myer CEO John King.

"Our focus must remain on operating our business in a manner that protects the health and wellbeing of customers and team members, whilst supporting the government, and the communities in which we operate, in limiting the spread of COVID-19."

"We will focus on ensuring we offer the best possible online experience for our customers, whilst being ready to restart the business in four weeks."

Fellow department store David Jones will remain open for the time being.

The company says it is monitoring the situation closely, but believes the large size of its stores will enable it to comply better with social distancing measures than other small-scale retailers.

"We have two smaller stores, Barangaroo, Sydney and James Street, Brisbane, where it is not practical to comply with the social distancing protocols as mandated by the government, so we have taken the decision to close these stores for a period of at least four weeks," says David Jones.

"All our other Australian stores remain open at this time, but please ensure you're up to date with our latest trading hours before your next visit."

The parent company of Country Road, Mimco, Politix, Trenery and Witchery announced the closure of its retail outlets on Saturday as coronavirus social distancing measures keeps Aussies inside.

Woolworths Holdings announced its stable of retailers will close until further notice on Saturday.

Updated at 8:30pm AEDT on 27 March 2020.

Carlton & United Breweries donates hand sanitiser to health workers

Australia's largest brewer has announced it will donate 20,000 litres of hand sanitiser to frontline medical staff as they fight COVID-19 in emergency wards around the country.

Belgian-owned, Melbourne-based Carlton & United Breweries (CUB) is producing at least 40,000 500ml bottles of hand sanitiser in partnership with leading hygiene company Ecolab.

"CUB always supports the community. And as the nation's biggest brewer, we have a part to play in battling this unprecedented crisis. Helping the people who are directly fighting the effects of this virus is a good start," says CUB CEO Peter Filipovic.

"We have the relationships and the know-how to get a project like this up and running quickly.

"For more than 150 years we've helped Australians come together over a beer. Now it's time to lend a helping hand as they stay apart to fight the virus. We'll have more announcements soon about how we're helping pubs and other customers get through this."

The company clarifies all the hand sanitiser it produces will be donated, while it will also be offered to vulnerable people in the community via support agencies, bottle shops, pubs, clubs and through its suppliers.

This will account for another 10,000 litres, bringing total production to 30,000 litres.

Ecolab will make the sanitiser using additional ethanol secured with support from CUB, ensuring thousands of litres of sanitiser gets to where it's needed most.

"We are very happy to be partnering with CUB and ensuring hand sanitiser gets to those who need it most," says Jan Pacas, Ecolab's managing director for Australia, NZ and the Pacific.

"This partnership has provided a big boost to our hand sanitiser production in a time when it's been crucially needed especially for our healthcare providers who are on the frontline."

The first bottles are expected to start leaving Ecolab's facilities this week.

Related story: Australian manufacturers heed the call for hand sanitiser supply

Updated at 12:04pm AEDT on 30 March 2020.

Stamford to temporarily close five hotels in Australia and New Zealand

A number of Stamford Hotels and Resorts hotels around the country will close in response to the Covid-19 crisis.

To ensure the health and wellbeing of guests, staff, and the wider community the following hotels will close temporarily from 31 March 2020:

• Stamford Plaza Melbourne
• Stamford Plaza Brisbane
• Stamford Plaza Adelaide
• Stamford Grand Adelaide
• Stamford Plaza Auckland

Sir Stamford at Circular Quay and Stamford Plaza Sydney Airport remain open for the present time, but with severe restrictions on their services.

Stamford Hotels and Resorts CEO Ow Yew Heng says government-imposed restrictions have led to a downturn in business and a stoppage of the vast majority of work employees conduct on a daily basis.

"We are determined to ensure that the business overcomes the significant challenges that we currently face," says Heng.

"We look forward to welcoming you back to our hotels soon, and trust you and your family remain safe and healthy."

Updated at 12:18PM AEDT on 30 March 2020.

PM wants businesses to "hibernate" until recovery, forced quarantine for new arrivals

Prime Minister Scott Morrison will introduce a third stimulus package to put businesses into 'hibernation', alongside heightened border control measures in an effort to isolate those returning to Australia from overseas.

At a press conference today, the PM announced that from midnight (after 11:59PM) on Saturday 28 March those entering Australia will be forced to self-isolate in hotels and other accommodation facilities for two weeks to complete their quarantine period.

The harsh measures will be imposed given two thirds of Australia's more than 3,000 confirmed cases of Covid-19 are from people returning from overseas.

The 14-day quarantine period for international arrivals will be enforced by State and Territory police along with extra support from the Australian Defence Force.

The new rule follows a recommendation from the Health Protection Principal Committee who said the single most important thing that can be done right now is to stop returning travellers from spreading the virus to Australians.

These new quarantine measures, which the PM hopes will slow the rate of infection within Australia, come in conjunction with a brief announcement that the Government is working on a third stimulus package that will effectively place Australian businesses into a state of "hibernation".

This package is still being worked on and details of the package will be released in the coming days.

It is part of what the PM calls a "battle on two fronts" being fought by the Federal Government: the public health crisis and the economic crisis.

"We want these businesses to effectively go into hibernation, which means on the other side, the employees come back, the opportunities come back, the economy comes back," says the PM.

"No decision that we're taking on the health front is being taken lightly."

"Every day someone is in a job is worth fighting for."

As reported earlier today by the ABC, the package will ideally see business owners able to emerge after the Covid-19 crisis without having to walk away from their companies.

It is expected that the package will include measures that will waive all overheads including rents and mortgage repayments, meaning banks, lenders and landlords will likely have to make sacrifices.

He hopes that those in commercial arrangements like landlords & tenants and employers & employees will communicate with one another to come to agreements.

"What's sensible is to understand the economic environment we're in and to see that on the other side it's in everybody's interest that everybody gets through," says the PM.

With regards to residential tenancies, the PM says there is "work being done" with state premiers to ensure a consistent approach for renters nationally.

According to the PM, Australia currently has the highest rate of testing in the world with 180,000 tests completed so far in per capita terms. South Korea is hot on our heels.

The PM commended the efforts of Australians to self-isolate thus far, citing how the movement of people around metropolitan areas has fallen by approximately 80 per cent.

"Thank you, keep doing it, you're saving lives and you're saving livelihoods," says the PM.

"This has been a significant shift and we need to see it keep taking place all around the country. We've called on you as Australians to come together in this effort and the response has been simply magnificent.

"Businesses are adapting as well. Distilleries are making hand sanitizer, large companies like Woolworths are completely changing how they do things and are employing more Australians, cafés are changing how they do things - businesses are being agile and they're adapting even under significant strain and stress."

Updated at 2:44PM AEDT on 27 March 2020.

Brisbane City Council offers rates relief to businesses facing hardship

The Brisbane City Council (BCC) has responded to community concerns by offering rates relief to businesses and residents experiencing hardship due to the impacts of Covid-19.

The assistance will apply to all ratepayers, including owner occupiers, non-owner occupiers and businesses.

Payment plans or deferred payment arrangements will be offered for up to 9 months and interest will not be applied to any outstanding amounts. Rates rating recovery processing will cease until further notice.

This is in addition to the $7.9 million business relief package released last week that is designed to relieve some of the pressure on businesses and other organisations while they take stock of the impacts on their operations as the coronavirus crisis unfolds.

Council will waive all charges, rents, levies and permit fees effective immediately for all businesses, as they face economic hardship caused by coronavirus impacts.

There will be a moratorium on fees and charges for:

• footpath and outdoor dining
• food safety permits
• commercial river moorings
• advertising
• temporary food stalls
• commercial lease rents
• commercial stalls, booths, and stands.

Lease fees for community organisations will not be collected. Businesses that have paid these fees since 1 March 2020 will have them refunded.

Updated at 3:32pm AEDT on 27 March 2020.