Voluntary cut to stores’ rent gains ground

The government appears to take a favorable view of a proposal for voluntary reductions to commercial property rents, submitted this week by the federation of property owners (POMIDA) and the Athens Tradesmen’s Association (ESA), though no decisions have been made.

The two associations, representing landlords and Athens merchants, have proposed the application of voluntary rental discounts up to 40%, asking the government to legislate for the extension of the measure returning 30% of landlords’ losses through tax offsets. This proposal concerns all voluntary rental cuts and concerns the period until the end of the year.

The prospect of owners securing a tax offset provides them with an incentive to negotiate good faith agreements with their tenants, mostly shopkeepers. The proposal relies on a measure first introduced by the government in March, but does not make it mandatory.

In the face of certain reactions, POMIDA clarified in a supplementary statement on Thursday that the voluntary rent reduction is the best option, compared to the mandatory reduction by law even in cases where that is not justified, against a total loss of the owners’ revenue if tenants cannot pay.