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10 Must Reads for the CRE Industry Today (April 6, 2020)

Over the weekend a coalition of 15 industry trade groups called on the federal government to establish a liquidity facility for mortgage servicers, reports Housing Wire. Commercial tenants in the U.K. are struggling to pay second quarter rents, according to CNBC. GlobeSt.com explored how multifamily property managers are weighing what to tell other tenants when a renter tests positive for COVID-19. These are among today’s must reads from around the commercial real estate industry.

  1. Broad coalition of mortgage industry and housing associations call for liquidity facility for servicers “Fifteen financial industry trade associations and affordable housing advocate groups issued a joint statement on Saturday calling on the Federal Housing Finance Agency, the Federal Reserve and the Department of the Treasury to establish a liquidity facility for servicers as a follow up to the mortgage forbearance provided by the CARES Act. Under the CARES Act, signed into law on March 27, homeowners with federally backed mortgages are provided with a foreclosure moratorium of at least 60 days starting on March 18, and the ability to get mortgage forbearance for up to 12 months.” (Housing Wire)
  2. Coronavirus hits commercial real estate in the UK as retailers fall behind on rent “Intu, a real estate investment trust with total assets of £10 billion including retail spaces across the U.K., said it received only 29% of the rent due for the second quarter, ending on March 25. In comparison, the company had received 77% of the payments due the time last year. Hammerson, another major real estate developer with retail parks in Britain, also warned that by late March it had received only 35% of second-quarter rent from its premium outlets in the U.K.’s biggest cities.” (CNBC)
  3. Property Managers Debate Whether to Tell Residents About Coronavirus Infections “Over the past month, Grace Hill, a software company that surveys multifamily industry, has been working with some 1,600 multifamily clients to help them to determine exactly what they should tell tenants about coronavirus infections in their buildings. Many have been struggling to navigate not only the legal limits as to what they can say as well as best practices, CEO Dru Armstrong tells GlobeSt.com.” (GlobeSt.com)
  4. Issues Facing Commercial Mortgage Lenders in the COVID-19 Pandemic “Rents, and therefore borrowers’ ability to make debt service payments, will be curtailed as, for example, retail tenants are forced to shutter their businesses and apartment dwellers face economic hardship on a rising tide of unemployment. In this environment, lenders will face tough decisions on how to proceed with transactions that have yet to close and with closed transactions that are running into trouble.” (National Law Review)
  5. Coronavirus Hasn’t Stopped Jared Kushner’s Real Estate Empire From Hounding Tenants With Debt Collection, Eviction Lawsuits “Jared Kushner’s family real estate company, which owns and manages thousands of apartment units, continued its aggressive eviction practices and debt collection lawsuits as Americans wait for government relief. Well into the coronavirus crisis, which has led to skyrocketing unemployment, court records show properties owned by Kushner Companies are still filing new eviction lawsuits.” (The Intercept)
  6. The Battle Between One REIT and This Activist Investor Is Only Heating Up “The coronavirus pandemic has put some proxy battles on ice, but the duel between real-estate investment trust Mack-Cali Realty and activist investor Bow Street is only heating up.” (Barron’s)
  7. NY Industrial May Become Increasingly Vertical As Market Reaches New Heights “As the demand for industrial real estate in New York grows, key players in the market say the only way for it to meet it is to reach new heights. The prospect that the city will rezone is slim, and industrial real estate builders need to find inventive ways to meet the demands of a surging market, said Jeff Randolph, managing partner at Bluecup Ventures and the former head of Amazon real estate.” (Bisnow)
  8. Invesco Raises $505M for First Closing of Asia Value-Add Real Estate Fund “US-based asset manager Invesco has reached a $380 million first close on its fourth APAC-focused value-add real estate investment vehicle, according to sources familiar with the firm’s fund raising. Including sidecar and coinvestment commitments, the managers of Invesco Real Estate Asia Fund IV have raised $505 million for the strategy, which wrapped up its first stage financing on 31 March.” (Mingtiandi)
  9. Construction in New York Limps Forward Despite Shutdown Order “But even as developers publicly say that keeping contractors healthy and curbing the coronavirus’s spread is the priority, some are privately complaining that the patchwork of new rules is a mess. And many are busily trying to make their case to officials that their projects, whether condos or rentals, serve a vital interest and should be exempt from the shutdown. A day after the order took effect, the buildings department had received more than 900 such appeals, a spokesman said.” (New York Times)
  10. How An Economic Crisis Can Impact Real Estate Investing “I believe we will see commercial real estate prices dropping as foreign equity, which is constantly looking to buy real estate in the U.S., will have issues with accessing U.S. markets. The outbreak will affect their ability to invest overseas.” (Forbes)
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