The laneway bar had been shielded from eviction under a state regulation forcing landlords to negotiate rent with commercial tenants – with half its rent deferred and half waived – as required by the federal government’s National Code of Conduct.
But since January 1 the regulation has been adjusted to only cover businesses with an annual turnover of $5 million or less, before it ends on March 28.
Businesses that experienced at least a 30 per cent decline in the 2020 December quarter compared to the December quarter in 2019 are also eligible.
Mr Almenning said he was frustrated to learn that while the bar’s annual turnover would amount to around $3.5 million he was no longer protected, because revenue from other venues, including in Victoria, was also counted towards the turnover and year-on-year comparison.
“When this rule changed in NSW we were still under severe restrictions, with one person per four square metres. The city was dead and our turnover was down 80 per cent,” he said.
“It’s not like NSW is out of trouble.”
Three days before a mediation session with the NSW Small Business Commission, Mr Almenning said his landlord cancelled the meeting, “evicted us and changed the locks.”
“I feel the government has changed the goal post mid-pandemic, while venues are still under restrictions,” he said, adding that he should be entitled to a reasonable period of recovery.
“What’s happened to us with our landlord is exactly what the code of conduct was written to prevent.”
The Sydney Morning Herald confirmed KKBB’s tenancy and eviction with the landlord, who said he did not wish to comment.
Hospitality industry figures say they fear the closure of the bar is just the start of what is to come, as remaining COVID-19 protections for commercial leaseholders end.
Restaurant and Catering NSW chief executive Wes Lambert said the risk of viable businesses being closed down could skyrocket if final rental protections were removed without any safety net.
“The hospitality sector is going to continue to need assistance from both state and federal governments well into 2021 … to save thousands of viable businesses and tens of thousands of jobs,” he said.
“This closure should serve as a canary in the coal mine when it comes to the hospitality sector.”
NSW Finance Miniser Damien Tudehope said the eligibilty criteria to protect commerical tenants had been tightened to support the most vulnerable businesses, due to an uptick in economic conditions at the end of last year.
He said the threshold amount reflected ABS data that 97 per cent of businesses in NSW have a turnover of less than $5 million.
“The majority of feedback we have received has indicated the willingness of so many landlords and tenants to sit down together and come to agreement,” Mr Tudehope said.
“Where agreements have been harder to reach, the NSW Small Business Commission can support parties to negotiate agreements and resolve disputes in a cost-effective and non-adversarial way.”
In response to the pandemic more than 90,000 small businesses accessed $3000 and $10,000 support grants from the NSW government.
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Lucy Cormack is a state political reporter with The
Sydney Morning Herald.