Healthcare multinational threatens four-month rent strike in Australia


Roselyne Bugeja, Bupa Dental’s head of leasing and property, said in the email to landlords that it had become clear the COVID-19 pandemic was not only a health crisis, but a financial one that will have a significant impact on the economy.

Ms Bugeja said the company had been forced to close stores or restrict trading hours to prevent the further spread of COVID-19 and was focussed on ensuring Bupa had a sustainable business to return to when the crisis is over.

“In regard to our lease rent obligations, it is vital that we work collaboratively together with our landlord partners to achieve a temporary rental abatement of 100 per cent gross rent effective from 1 April 2020 to 31 July 2020,” she said.

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The company has 56 dental clinics across NSW, Victoria, Queensland, Tasmania and South Australia. The abatement is likely to cost landlords and shopping centres hundreds of thousands of dollars throughout the crisis, with no clear pathway on repayment mechanisms or guarantees.

The national code, which has yet to be legislated by the states and territories, will push landlords to waive and defer lease repayments in proportion to the loss of income experienced by a business. Housing Minister Michael Sukkar has called for at least 50 per cent of the deferred payment to be waived altogether, so that businesses are not saddled with debt after the crisis, but there is no government guarantee on this lost income for landlords or on money owed if the tenant goes bankrupt.

The code is mandatory for businesses with revenue of under $50 million. Because Bupa’s turnover is well in excess of that it is not compulsory and the government has urged landlords and owners to negotiate and work it out among themselves.

One landlord who is now receiving legal advice and asked not to be identified, described it as “just opportunistic behaviour”.

“Check out the profits reported by Bupa Australia last financial year,” they said. “There is nothing under the lease terms that allow Bupa to not pay rent.”

Mark Jeffery, managing director of Bupa Dental corporation, said the company was in the process of contacting dental practice landlords, “to discuss options for rent relief”.

“We understand that we are not the only organisation speaking to landlords right now, and we hope that we can come to a mutual agreement given these unprecedented and challenging times,” he said.

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