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11 Must Reads for the CRE Industry Today (June 1, 2020)

Intense protests around the United States against police brutality that featured sporadic looting forced retailers that had been reopening from COVID-19 shutdowns to close back down again, reported Reuters. Meanwhile, a major retail federation has been pushing for governmental aid top help companies survive, according to the Washington Post. And the Wall Street Journal explored how the future of movie theaters is in doubt amid the continuing pandemic. These are among today’s must reads from around the commercial real estate industry.

  1. Retailers already hit by coronavirus board up as U.S. protests rage “Target Corp and Walmart said on Sunday they shuttered stores across the United States as retailers already reeling from closures because of the coronavirus pandemic shut outlets amid protests that included looting in many U.S. cities.” (Reuters)
  2. Desperate retailers to ask Fed, Treasury for emergency help amid worries that economic turmoil could worsen “Without a Treasury or Fed guarantee of its routine financing, the retail industry could suffer ‘a commercial credit crisis that threatens to seize up our economy and stall the safe restart in its infancy,’ the American Apparel and Footwear Association will warn Treasury Secretary Steven Mnuchin and Federal Reserve Chair Jerome H. Powell in a letter early this week. The trade group represents more than 1,000 name-brand companies, including manufacturers and retailers.”  (Washington Post)
  3. Gone With the Wind: Pandemic Threatens to Reduce Movie Theaters to Rubble “The situation is seen leading to many theater closures, say analysts and industry veterans, creating the problem of what to do with the buildings once the curtain goes down for good. According to theater owners and real-estate experts, cinemas tend to be tough properties to move because the sloped floors and multiple rooms make them difficult to repurpose, especially in a commercial property market expected to get crowded with closed retailers, small businesses and offices.” (Wall Street Journal)
  4. Bad Actors Of All Kinds are Taking Advantage of Rent Relief Initiatives “Although many tenants have a legitimate need for such protection during the pandemic, such a large focus on and empathy for tenants is also being abused by certain “bad actor” tenants that are aggressively demanding rent relief from their property owners and—in many instances—unilaterally refusing to pay rent.” (GlobeSt.com)
  5. After flocking downtown to woo millennials, offices might be moving back to the suburbs “What was once a land grab for downtown real estate could pivot to be rush to the suburbs, where space is plentiful and social distancing is much easier to enforce.” (CNBC)
  6. Reeling From The Pandemic, California CRE Braces For Key November Ballot “Introduced in a pre-pandemic world, a pair of California measures opposed by commercial real estate will go before state voters in November, who may be much more receptive to their ability to boost local budgets.” (Bisnow)
  7. NY Legislature Approves $100M Rent Voucher Bill For Tenants Affected by Coronavirus “The program, administered by the state Department of Housing and Community Renewal,  will offer rent vouchers to New Yorkers earning less than 80 percent of the area median income both now and before the pandemic struck in March. (Eighty percent AMI is $63,680 for a single person and $90,960 for a family of four.)” (Commercial Observer)
  8. New St. Louis tax abatement policy would claw back incentives after high-dollar sales “In a new policy meant to limit tax incentives routinely granted to developers, city officials plan to institute tax abatement clawbacks when developers sell projects to investors at high prices.” (St. Louis Post-Dispatch)
  9. NYC’s Finance Jobs Won’t Recover for Six Years, Analysis Shows “New York City’s finance industry won’t recover from the devastation wrought by Covid-19 until 2026, according to an analysis by software firm LaborIQ by ThinkWhy that ranks U.S. employment markets.” (Bloomberg)
  10. NYC Lease Guarantors Gain Temporary Personal Liability Protections During COVID-19 “On May 26, 2020, New York City Mayor Bill de Blasio signed into law Int. No. 1932-A, amending the New York City Administrative Code to prohibit enforcement of personal liability against natural persons for certain commercial leases. Int. No. 1932-A is intended to protect guarantors of restaurant, bar and other non-essential retail leases for businesses that were forced to close under the executive orders issued by Gov. Andrew Cuomo in the early days of the COVID-19 pandemic.” (JDSupra)
  11. Boston Properties touts 97% of office rent was collected in May “Boston Properties says that in May it collected 97% of its office rent — the source of the vast majority of its revenue — across its 51.8 million-square-foot portfolio, as it sought to calm investors after it withdrew its full-year guidance last month.” (Boston Business Journal)
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