Over the past 3 years, eviction moratoriums have become part of our vernacular due to the state of things. And, while we know that eviction moratoriums apply to residential real estate, some commercial tenants and landlords may wonder if they apply to commercial real estate in Arizona.
What is an eviction moratorium?
Essentially, an eviction moratorium typically stops landlords from evicting their tenants for the nonpayment of rent and various other reasons. They can be issued by local, state and federal authorities from losing housing during times of economic crisis or public health emergencies.
Do they apply to commercial real estate?
Sometimes. Eviction moratoriums exist to combat an issue at a particular time and place. Some only apply to residential properties, but some could include commercial properties as well. It all depends on the language in the moratorium itself.
What about Arizona?
Back in April 2020, Executive Order 2020-21 placed an eviction moratorium that applied to commercial evictions, but only for small businesses. These were Arizona businesses with less than 500 employees. It expired on May 31, 2020, but it provides us an example of how future eviction moratoriums could affect commercial real estate.
Specifically, stopped commercial landlords from engaging in any eviction activity, including locking out tenants or initiating eviction proceedings. Executive Order 2020-21 did not provide tenant debt forgiveness or provide funding. Instead, it recommended that commercial landlords restore any past due rent to facilitate debt repayment, and it encouraged landlords to forgive any accrued late fees and penalties. Though, there were no mandates for landlords to do so.
Are there any current eviction moratoriums?
Currently, there are no Arizona or federal eviction moratoriums that apply to commercial real estate. Even the federal eviction moratorium expired in 2021. Though, that does not mean one could not be passed in the future. As with all business-related laws, it is on business owners to stay abreast of law changes.