Ontario’s Commercial Rent Crisis

Could you handle a 30% rent increase from one month to the next?

The COVID-19 pandemic deepened a pre-existing crisis: Unaffordable commercial rent is shutting down successful small businesses.

Today there are no commercial rent guidelines or standards in Ontario. This instability is a major stressor for small business owners and is forcing too many closures.  Commercial landlords can charge, change, and do almost anything they want.

Since launching our Commercial Rent Report in February 2022, we’ve heard from Ontario businesses whose commercial rent has increased 10, 20, even more than 50% from one month to the next.

It is legal to increase rent by any amount.  We understand that many commercial landlords are small business owners that understand predictable lease increases are the best policy.  When commercial rent in an area is raised too quickly, local businesses communities tend to exchange decades old, locally-owned businesses for chain and box stores.

Commercial Landlords can evict small businesses in favour of new tenants or leave the space vacant, even after small business owners have paid out-of-pocket to renovate. Landlords can pass on surprise bills for thousands of dollars at their sole discretion. They are not held to basic building maintenance repair or heating and cooling standards.  Strangely, even municipalities can’t even compel landlords to repair their own buildings – business owners have to sue for issues that may need to be fixed yesterday.

Handshake leases and month to month agreements may have worked before – but now the system is broken.

Add your name and support action to protect Ontario’s Main Street Businesses

The BWA is calling on the Ontario government to Reform Commercial Rent by:

  • Working to simplify and standardize commercial rent and lease agreements to ensure fairness and transparency for shared costs. And ensure priority is given to existing tenants when lease term is up.
  • Creating a Commercial Tenants Board to quickly and affordably resolve disputes – and avoid further backlogs to Ontario’s court system.
  • Undertaking a thorough update of the 32-year-old 1990 Commercial Tenancies Act and responding to the issues affecting business tenants today.

For small businesses to recover and thrive, commercial rent reform is needed.

Are you a Business Owner being affected? Contact us.

Rent is a top expense for small businesses

– 9 in 10 list rent as one of their top three expenses.
– For over half, rent accounts for more than 60% of overall expenses.

Dramatic rent increases are the norm for small businesses

– Three quarters have experienced a one-time rent increase of 10% or more.
– 1 in 6 have experienced an increase of 50% or more.
– 1 in 10 have seen their rent double during a single increase.

Small businesses worry about having to move or permanently close

– Over 40% of small businesses have moved in the past due to rent increases or difficulties with their leases or landlords.
– Over half anticipate being forced to move at the end of their current lease for these reasons.

We endorse the report recommendations for commercial rent guidelines and standards

NameBusiness name (if applicable)
Janice DeFilippiAstanga Yoga Ottawa
Sabrina ByartPhoenix Education & Learning Centre
Samantha RichardsonEthical Profit Agency
Barbara Hogg
Gyuszi Berki
Kaite Burkholder Harris
Gwen BangCatering with a Bang Inc O/A LOLA
Valérie LeloupNu Grocery
Jess MauriceGameopolis
Sid DichterSupermarket
NameBusiness name (if applicable)

It is clear that we need urgent action by the Ontario provincial government to remedy the commercial rent affordability crisis for small businesses.

Help spread the word

For questions about this report, contact info@betterwayalliance.ca.
Released February 2022.