It is planned to allocate up to 20 million euros to the rental support program for shopping centers, a working group led by the Minister of Finance Jānis Reirs (JV) has agreed on Tuesday to support business and employees.
The Ministry of Finance was informed that the working group on Tuesday considered the proposal developed by the Ministry of Economics (MoE) for a rent support program for shopping centers. The final decision will still have to be made by the Cabinet of Ministers.
Shopping centers with an area of more than 7,000 square meters will be able to apply for the support program, the total amount of which is estimated at up to 20 million euros.
The amount of support will be 15 euros for each square meter of the area indicated in the cadastral survey file of the shopping center, except for parking lots. It is planned that one shopping center will be able to apply for support in the amount of 1.8 million euros.
The support will be available until May 15, and the program will be administered by the Latvian Investment and Development Agency (LIAA).
The support program envisages that the shopping center will not be able to demand additional payments from the tenants for the invoices issued for the rent for January, February and March 2021.
Shopping centers whose total decrease in estimated rental income due to the Covid-19 crisis in the first three months of this year, compared to the corresponding months of 2019 or 2020, will be eligible for support.
It has already been reported that the Latvian Chambers of Commerce and Industry, the Latvian Employers ‘Confederation, the Real Estate Developers’ Alliance and the shopping center – Domina Shopping, Origo, Galleria Riga, Saga, Ozols, Dauga, Sky & More, Via Jurmala Outlet Village and Valleta – representatives on Monday, March 229, sent an open letter to Prime Minister Krišjānis Kariņš (JV), signaling the critical situation in the industry and requesting a meeting with government representatives.
The authors of the letter point out that the unpaid rent payments of shopping centers in 2020 have caused a loss of at least 42 million euros, and the conceptual decision taken at the end of last week to partially open stores, discriminating against shopping centers, will only worsen the crisis.
The letter states that for more than a year, various restrictions have been introduced in the trade sector, which affects every trader in Latvia. The decline in shopping center rental income reaches as much as 100%, and in the period from October 2020 to March 2021, it has caused losses to shopping centers from unpaid rent in the amount of 37 million euros, but in 2020 the loss has reached 42 million euros.
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