SEPANG – Malaysia Airports is cognizant of the difficulties faced by all categories of retailers operating at its airports and has unveiled a new customised relief package, demonstrating its commitment and care in working with its partners to mutuallysurvive and sustain business during the COVID-19 crisis. The relief package will offer 100% rental rebates for six months from July to December 2020 to all retailers. On top of the full rebates, the relief package is customized to offer the pre-existing retailers special rental which is tied to the passenger growth rate starting from January 2021 onwards. For retailers who have signed up under the Commercial Reset programme, the relief package is customized to offer 30% rebate on rental starting January 2021 with a mechanism to compensate them with contract extension based on actual traffic growth rate.Additionally, airline partners will also enjoy up to 30% rebate on aeronautical charges (not including Passenger Service Charge) such as landing, aircraft parking, aerobridge and check-in counter charges.
This latest relief package will supersede the one announced last September, where airport retail tenants are given rental rebates up to only 50% for six months in 2020. This had followed the 6 months moratorium on rental which was applied from May to October. Under the new customised relief package, Malaysia Airports have taken the initiative not only to assist the retailers further by giving 100% rebate for July to December 2020, it is also extending its assistance into the future to enable the retailers to sustain its operations beyond 2020 in view of the prolonged impact of the pandemic on passenger traffic recovery. In 2021 onwards, the pre-existing retailers will only be charged rental based on the actual passenger growth rate at the airport for example if the passenger traffic is at 20%, then they will only pay 20% of the full rental. Meanwhile the New Rental Model applicable for those under the commercial reset programme, will enable eligible retail tenants to enjoy up to 30% rental reduction from the current rates with the added benefit of compensating the gap in traffic lower than 70% with extended contract period. As an example if the passenger traffic is at 20%, then the 50% difference will be converted into contract extension equivalent to double the value of the difference. This is to ensure their sustainability in the long-term commercial reset programme.
Malaysia Airports group chief executive officer (CEO) Dato’ Mohd Shukrie Mohd Salleh said that this latest relief package is in response to pleas from tenants who are facing cash flow challenges especially with the re-imposition of the Conditional Movement Control Order (CMCO) in most states in Malaysia, “As we have mentioned before, we are committed in ensuring that the airport community is able to survive this crisis together. It is with this guiding principle in mind that we took this step to offer the additional rebates despite being in the red ourselves for the last three quarters and that this will reduce our cash reserves further. We are very much hoping that similar to other airports around the world, the government can extend the necessary assistance so that we can continue supporting the airport business community.” “What we are doing for our retailers is over and above any assistance package offered by any city mallsand we believe that it is a fair package for all parties under the circumstances”, he further added.