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11 Must Reads for the CRE Industry Today (June 4, 2020)

The New York Times looks at what campus life might be like in the fall. New York & Company might be the next retailer to go bankrupt, reports CNBC. These are among today’s must reads from around the commercial real estate industry.

  1. Coronavirus Shock Could Upend the Las Vegas Economy for Years “The pandemic hit Nevada’s workforce harder than any other U.S. state and poses a potentially existential threat to Las Vegas’s business model based on bringing people together for gambling, entertainment and conventions. Even as some casinos and other venues prepare to partially reopen, questions linger about how willing Americans will be to fly, grab a pair of dice from a stranger and dance in a nightclub.” (Wall Street Journal, subscription required)
  2. New York & Company Owner RTW Retailwinds Warns Bankruptcy Filing Imminent “New York & Company parent RTW Retailwinds on Wednesday morning warned about its ability to continue as a going concern, and that it might be preparing to file for Chapter 11 bankruptcy protection, hit hard by the Covid-19 crisis. It said in an 8K filing with the Securities and Exchange Commission that it is in the process of finalizing a 10K filing with its auditor that will reflect, among other things, ‘a substantial doubt’ about its ability to continue as a going concern.” (CNBC)
  3. Distress Investors May Have to Wait as Long as 3 Years for Non-Performing Loans to Come to Market “Distress investors have been racing to the market in anticipation of snapping up deals. For the most part they are finding, to some chagrin, that there are little properties and loans available at deep discounts. There has been much positing about when these transactions will come to market—the end of summer and the fourth quarter are two popular timelines—but a better question might be to ask, why are there no distress deals available now? That answer in turn becomes a straight line to the question of when.” (, subscription required)
  4. What Will College Be Like in the Fall? “Some schools, especially small colleges in rural areas, could try to enlarge the closed circuit, perhaps even encompassing the whole campus. This could really only be done if some staff and faculty are within the closed circuit, while others work at a greater distance. The point is to reduce risk as much as possible. Some of that involves testing and asking people to self-report any symptoms, including minor ones. And also, maybe you have mostly teaching fellows or graduate students, rather than older faculty, closely interacting with students.” (The New York Times)
  5. Blackstone’s Property Arm Assets Swell to 250 Bn Euros “Blackstone has tightened its grip on the crown of world’s largest real estate manager for a fourth consecutive year after property assets controlled by the New York-listed group surged to nearly €250bn. Assets managed by Blackstone’s property division jumped 23 per cent to €248.5bn ($278bn) in 2019, according to an annual ranking by Inrev, the European association that represents investors in non-listed real estate vehicles.” (Financial Times)
  6. Struggling Subway Quietly Leases Miami Office Space “Subway Restaurants is quietly making plans to open an office in sunny Miami, The Post has learned. Subway’s hard-driving Chief Executive John Chidsey — hired in November to revamp the struggling company — signed a lease last week for office space near Doral, Fla., just west of the Miami International Airport, sources said. In a statement, the struggling restaurant chain insisted it is not looking to get rid of its longtime headquarters in Milford, Conn.” (New York Post)
  7. The Most Important Word in the Hospitality Industry? ‘Clean’ “According to the American Hotel & Lodging Association, an industry group, the coronavirus outbreak has cost hotels in the United States more than $23 billion in room revenue since mid-February. As these properties prepare for a new operational reality — one that must balance federal, state and local laws and consumer anxiety about getting sick — the world’s largest hotel companies have all come forward in recent weeks to announce new cleaning playbooks.” (The New York Times)
  8. AMC Warns of Going Concern as COVID-19 Puts Strain on Theaters “AMC Entertainment Holdings Inc said on Wednesday there were “substantial doubts” about its ability to continue operating, if the company was forced to keep its theaters closed for a longer period because of the COVID-19 pandemic. Movie theaters worldwide have been shut since mid-March to help contain the spread of the novel coronavirus and many potential box-office draws such as ‘Top Gun: Maverick’, the new James Bond film ‘No Time To Die’ and Walt Disney’s ‘Mulan’ have been pushed later into the year.” (Reuters)
  9. Potential Tax Break for Protest Property Damage “Franklin County Auditor Michael Stinziano said his office will work with owners dealing with damage to determine if tax breaks are available, through an existing mechanism usually for properties hit hard by storms or other natural disasters. There may be some tax relief for property owners dealing with damage from recent protests and demonstrations Downtown and elsewhere.” (Columbus Dispatch)
  10. Working from Home? You Might Be Able to Expense a New Desk “As remote work takes off, the issue of home-office reimbursements could become a legal one, said Josh Henderson, a labor lawyer and partner at Norton Rose Fulbright. In some states, including California, Illinois and Massachusetts, employers are legally required to pay their workers’ back for certain expenses they pick up on the job. Meanwhile, in every state, companies must reimburse minimum-wage workers for job-related expenses. ‘The pandemic is bringing these issues to the fore,’ Henderson said, predicting remote employees will make new arguments around what expenses their employers should cover. (CNBC)
  11. Co-Working Firms Respond to Industry Threat with Joint Safety Effort “More than 20 of the world’s largest co-working firms, suffering a threat to their business from the pandemic, have agreed to coordinate in a way that would have been unheard of before the crisis. The firms, which include Industrious and Convene in the U.S., JustCo of Singapore, and IWG PLC of the U.K., have formed a new umbrella organization known as the Workplace Operator Readiness Council. Members said the group would release a playbook this week detailing specific steps they have agreed to take to make workplaces safer, including contact tracing, decontamination and social distancing.” (Wall Street Journal, subscription required)
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