COVID-19 relief: Dubai extends rent-free period for over 1,000 commercial tenants

Emergency relief estimated to be worth around $54 million

  
View of Dubai Sheikh Zayed Road amidst coronavirus sterilization champaign all over UAE. Image courtesy Dubai Media Office Twitter handle.

View of Dubai Sheikh Zayed Road amidst coronavirus sterilization champaign all over UAE. Image courtesy Dubai Media Office Twitter handle.

Over 1,000 commercial tenants, employing about 10,000 workers in Dubai altogether, will get another rent-free extension for three to six months.

Sheikh Hamdan bin Rashid Al Maktoum, deputy ruler of Dubai and Minister of Finance, has issued directives to offer rent-free exemption to the business tenants of Dubai Developments Group properties, which include a number of small firms and entrepreneurs.

The emergency relief, estimated to cost around 200 million UAE dirhams ($54 million), seeks to alleviate the financial impact of the coronavirus pandemic on some businesses in the emirate.

“The gesture is aimed at mitigating the financial pressures faced by tenants due to the novel coronavirus pandemic and its repercussions on the global economy,” according to a statement issued by the Dubai Media office.

The coronavirus pandemic has crippled many businesses and left millions of workers jobless. Among the hardest hit in the UAE are companies in the construction and retail sectors, where more than 350,000 people are expected to lose jobs, according to estimates by Oxford Economics.

Entrepreneurs in Dubai have been negotiating with landlords to waive the rent for a few months or provide them with discounts, to help them cope with the business slowdown. However, some landlords are reportedly not cooperative.

“Our business is down 80 to 85 percent, so we are trying to reduce our costs wherever we can. We are asking landlords to reduce the rent by at least three to six months or give us some discount so that we can breathe and survive. [The feedback we received from] some landlords have been positive, but most of them have not been very positive,” Chandu Siroya, owner of Siroya Jewellers, told Zawya earlier.

Rent exemption

The rent exemption ordered by the Ministry of Economy will depend on the type of business activity. It is estimated that some 1,500 businesses that employ 10,000 workers will benefit from the initiative

The initiative is also expected to contribute to enhancing the businesses’ financial stability, the statement added.

“The rent exemptions will contribute to enhancing their investment and financial solidity of the businesses, the financial stability of their employees, numbering over 10,000, as well as the wellbeing of their families,” the statement said.

(Reporting by Cleofe Maceda; Editing by Seban Scaria)

Cleofe.maceda@refinitiv.com

#DUBAI #RENT #REALESTATE #COMMERCIAL

Disclaimer: This article is provided for informational purposes only. The content does not provide tax, legal or investment advice or opinion regarding the suitability, value or profitability of any particular security, portfolio or investment strategy. Read our full disclaimer policy here.

© ZAWYA 2020

More From Real Estate