It should come as no surprise to anyone that over the last two weeks, most of the inquiries we have received from landlords concern rent. More specifically,
arrears. Our responses to each of these inquiries largely reflect the following:
1. Get yourself sorted
It has been made abundantly clear to APIA members that in times like this, cash-flow is king. Take a good look at your cash position right now. What are the incomings? What are your
outgoings? Do you qualify for any government assistance packages?
Has your employer given you any indication around the security of your job? Are you aware of any clients who may not be able to pay your bill in the
short to mid-term?
Stress-test your portfolio right now. Look at how your cash position will change if one or more of your tenants default. What would that look like if some
or all of your tenants get a slight reduction or deferral? How much pain can you withstand? Can you deleverage by selling some properties
at the end of L4. What would that look like? Have you spoken to your bank or got some good financial planning in place to weather the storm?
Until you know exactly what your capacity is, you are not in a position to help anyone else.
2. Check-in with your tenants
If you haven’t already, you should. In the age of social media that conveniently diminishes facts while celebrating manufactured outrage, it is easy to
buy into the landlord vs tenant rhetoric. And you would be shortsighted to do so if not downright wrong. Long-time investors will be the first to remind
you of the symbiotic relationship that...
