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- Cromwell Property Group (CMW) has withdrawn its 2020 guidance, after the government announced a new mandatory commercial tenancy code of conduct
- The new code will help struggling businesses during the COVID-19 pandemic and could impact some of Cromwell’s leasing arrangements
- The code will apply to businesses that have a turnover under $50 million and see more than a 30 per cent reduction in revenue
- The new tenancy code is currently being finalised by The National Cabinet
- Cromwell’s shares remain flat and currently trading at 74.5 cents each
Cromwell Property Group (CMW) has withdrawn its 2020 guidance after the government announced a new tenancy code to help COVID-19 affected businesses.
The company claims it is unable to determine the impact of the new tenancy code on its operations. Therefore, Cromwell has retracted the guidance until the code’s effects and the ongoing impact of the pandemic become clearer.
In an address on Friday, 3 April, Prime Minister Scott Morrison outlined the mandatory commercial tenancy code of conduct. Although still in the draft stage, the code will apply to businesses that see a 30 per cent reduction in revenue and have a turnover of less than $50 million.
The code’s specifics have yet to be announced but The National Cabinet is currently working on a final draft.
CEO of Cromwell, Paul Weightman noted the great challenges posted by the COVID-19 pandemic.
“COVID-19 continues to be an unprecedented global event and we recognise the urgent nature of the emergency, our responsibility to help flatten the curve and contribute to the ensuing recovery in all the countries, cities and communities in which we operate.
“We are conscious that we have a wide range of stakeholders including employees, security holders, tenants, suppliers, contractors and service providers impacted by COVID-19,” he said.
Weightman went on to say that around 40 per cent of the company’s income is from government tenants, which are less affected by the recent economic downturn.
Weightman also stated that there were still opportunities available to the company, despite the overall industry slowdown.
As an example, he noted that the company has recently leased the Wakefield Hospital to SA State Government for the treatment of COVID-19 patients.
Cromwell shares remain flat and are trading for 74.5 cents each at 9:51 am AEST.
