Back to Bills

Cap Commercial Rent Hikes for Small Tenants

Full Title:
Commercial Rent Cap Act

Summary#

  • This bill would cap rent increases for many small businesses and charities that rent commercial space in Nova Scotia. It aims to stop sudden rent spikes and make leases clearer and fairer.

  • It creates a tenant certificate for eligible small businesses and charities. Only tenants with this certificate get the protections.

  • Key changes:

    • Rent for eligible tenants cannot rise in the first 12 months of a lease. After that, it can go up only once a year and by no more than the annual inflation rate for Nova Scotia (Consumer Price Index).
    • Leases must be in writing, usually at least 12 months, and must list all common area and operating charges line by line.
    • Landlords must give an annual breakdown of common area maintenance fees and flag expected increases for the next year.
    • If no non-renewal notice is given 60 days before a lease ends, the tenancy continues month-to-month under the same terms. Any increase then is still capped by inflation and needs 60 days’ notice.
    • Landlords can ask to raise rent above inflation only for clear reasons like large building upgrades, higher property taxes, or higher utility costs, and must get approval from the provincial Director (the official who handles tenancy disputes).
    • Tenants get protections against non-renewal and eviction without valid reasons. Fines for breaking the rules can be high.

What it means for you#

  • Small businesses (independent, up to $3 million in annual revenue)

    • You can apply for a one-year tenant certificate. With it, your rent increases are limited to once a year and capped by inflation after the first year of your lease.
    • You get clearer leases and yearly statements that show where your building fees go (cleaning, utilities, insurance, repairs, security, management).
    • If services you had (like cleaning or heating) are cut or reduced, you can ask for a rent reduction.
    • When your fixed-term lease ends, you choose to renew on the same terms or go month-to-month, unless the landlord has a valid reason to say no (like major renovations, owner’s own use, sale/demolition, or a serious breach).
    • If your landlord raises rent above the cap without approval, you can claim the extra back as a debt owed to you.

  • Charitable organizations (registered charity, fewer than 50 full-time equivalent employees)

    • Same protections as small businesses once you get a tenant certificate.

  • Who is not eligible

    • Publicly traded companies, chain or franchise businesses, tenants linked to the landlord’s corporate control, or organizations with more than $3 million in yearly revenue.

  • Commercial landlords

    • You must cap rent increases for eligible tenants and provide itemized charges and annual fee statements.
    • You can apply for above-inflation increases for approved costs (e.g., higher property taxes, utilities) or major improvements that extend the life, safety, accessibility, or energy efficiency of the property.
    • You cannot refuse to rent solely because someone is an eligible tenant; refusals must be in writing with reasons.
    • Ending a fixed-term lease just because the term ended is not allowed; valid grounds are required.
    • Penalties for breaking the rules can be up to $50,000 for individuals and up to the greater of $500,000 or 2% of annual revenue for corporations. In some cases, the minimum fine is at least one year’s rent.

  • Lease and notice basics

    • Leases must usually be at least 12 months (the tenant can waive this).
    • No rent increases in the first 12 months.
    • After that, at most one increase every 12 months, capped by inflation, with at least 60 days’ written notice on month-to-month tenancies.
    • If no non-renewal notice is given 60 days before a lease ends, it continues month-to-month on the same terms.
    • Tenants may appoint an authorized representative (like a lawyer or broker) to deal with the landlord.

  • Timing

    • The Act would take effect January 1, 2026.

Expenses#

No publicly available information.

Proponents' View#

  • Helps keep local shops and charities open by stopping sudden, steep rent hikes.
  • Provides predictability so small tenants can plan and invest in their business.
  • Increases transparency with itemized fees and yearly statements to prevent hidden charges.
  • Protects tenants from being pushed out at lease end without a valid reason.
  • Still lets landlords recover real cost increases and building upgrades through approved applications.
  • Uses existing dispute processes (through the Director) to keep oversight practical.

Opponents' View#

  • Could discourage investment in commercial properties or upgrades if returns are capped.
  • Landlords may become more selective, which could make it harder for some small tenants to find space, even with anti-discrimination rules.
  • May shift pressure to higher starting rents for new tenants since caps don’t apply to new leases.
  • Adds paperwork for landlords (itemized charges, annual statements, applications for above-cap increases) and may lead to more disputes.
  • Excludes chains and franchises, which some see as unfair to locally owned franchise operators.
  • Complex rules could create confusion about what counts as eligible costs or valid grounds for non-renewal.