Commercial News Archives | Page 60 of 71

May 13 No Comments

Related Group Pays $19M For Wynwood Development Site

Author: Admin

Categories: Commercial News,FIP News,Wynwood

The Related Group made another big investment in Miami’s Wynwood neighborhood with a $18.5 million property acquisition.

ERBA Diagnostics, previously known as Diamedix Corp., sold 2.27 acres at 2141-2115 N. Miami Ave., 2150-2160 N. Miami Ave., 38 N.W. 22nd St. and 2155 N.W. Miami Court to PRH Investments, an affiliate of Miami-based the Related Group.

Dave Colonna of FIP Realty represented The Related Group in the deal.

Cushman & Wakefield’s Robert Given, Troy Ballard, Miguel Alcivar, Greg Masin, Frank Begrowicz and Jason Hochman represented the seller.

The property has five buildings for a combined 51,205 square feet. However, the zoning would allow for greater density in a mixed-use project.

Wynwood has been transformed from an industrial area into an attraction for street art, entertainment, shopping and dining. New zoning has led to a massive amount of redevelopment with apartments and offices.

“As Wynwood continues to develop and mature into a world-class hub for the arts and creative businesses, opportunities to acquire large development sites are growing harder to come by,” said Alcivar. “This offering presented a rare opportunity to acquire critical mass with flexible zoning in one of the nation’s most exciting neighborhoods.”

The Related Group couldn’t be reached for comment on its plans for this property.

The Related Group has been especially active in Wynwood. It co-developed the Wynwood 25 apartments, the Wynwood Annex office building, and the Bradley Wynwood, which is being leased to a short-term rental company. It has a mixed-use building planned on Northwest 29th Street and a co-living project slated for Northwest 28th Street.

“While Wynwood is known for its dozens of art galleries and an ever-growing number of restaurants, bars, and retailers, the submarket is only just now starting to see larger scale mixed-use development,” said Given. “This assemblage presents the buyer with an exceptional opportunity to tap into Wynwood’s growth potential and be part of its maturation into a liveable neighborhood.”

Source: SFBJ

May 11 No Comments

Coronavirus Could Set Back The Pro-Density Movement

Author: Admin

Categories: Commercial News,Development,Leasing,Multifamily,Offices,Trends

The movement toward dense, transit-adjacent development picked up steam over the last few years, but the coronavirus pandemic might prove to be a big setback.

The pandemic has forced a quick national pivot toward telecommuting, which some think could undercut the utility of living near transit, according to the New York Times. If you don’t need to go into the office so often, why not spread out a bit?

Density advocates and lawmakers will likely find the pandemic gives rivals new ammunition to argue against their push for more zoning.

Some pro-density lawmakers, like California State Sen. Scott Wiener cautioned that there will still be a need for housing in his state after the pandemic subsides. Wiener has been trying to pass a statewide transit-oriented development bill for years and presented his most recent version in early March, just before coronavirus took the state by storm.

Developers meanwhile have to weigh consumer interest in such housing. Bob Youngentob, CEO of Maryland-based developer EYA, said his firm might switch its focus from more dense transit developments to townhomes if demand for the former falls enough.

“The forced interaction of sharing doors and elevators has caused some anxiety,” Youngentob told the Times. “Townhomes, where you come in and out of your door, and you know you are the only one touching your door handle, provide some comfort.”

Those who continue to build dense projects might reconsider their design strategy for public health — walkways could become wider and open spaces larger, for example.

Source: The Real Deal

May 09 No Comments

Co-Living Was Built Around Sharing Living Spaces with Strangers. Will It Survive Through a Pandemic?

Author: Admin

Categories: Commercial News,Development,Multifamily,Trends

Before the coronavirus hit, co-living projects were attracting more and more investor money.

Now, as public officials continue to encourage social distancing, questions are rising about whether residents in co-living buildings can even follow these guidelines, as they share communal spaces and sometimes even bedrooms. NREI spoke with Gregg Christiansen, president of Ollie, a co-living operator, about the state of the co-living industry and how the sector has been responding to the pandemic.

This Q&A has been edited for style, length and clarity.

NREI: How has the coronavirus outbreak impacted the sector?

Gregg Christiansen: I think it’s a little too early to tell. What we saw so far in our assets at Ollie, where we focus on long-term leases and institutional quality buildings, we initially saw a pick-up in occupancy in the first few weeks. I think that was really due to the ease of moving into one of our co-living units. So, when all the universities shut down their student housing buildings, we saw an influx of people wanting to move into an Ollie property. So, that was a good thing, I think that was a positive.

I think there has been some criticism, or at least people thinking and starting a little bit too early of a debate, in my opinion, around densification and urbanization. There’s some debate starting to happen on whether urbanization is going to be a thing in the future and whether densification is going to be a bit more criticized than it has been in the past, given that COVID is a virus that transfers to people in close quarters. So, the question is if the government is going to demand spaces to be bigger where people live. If that’s the case, I think there’s going to be a lot of people pushed out of the cities, because the cost of those units is going to be much more expensive to build. So, I think there’s a little bit of a double-edged sword right now in some of the arguments.

What we’ve seen from a positive standpoint as well is our residents have actually appreciated being around roommates and not feeling like they are living in a studio or a one-bedroom apartment all by themselves. So, they actually have the ability to interact with their roommates. So, we view that as a positive from some feedback that we’ve seen. But there’s going to be a debate around apartment buildings and “are people going to be more inclined to live in the cities or not?” That’s a much broader discussion to have, so we’ll see what happens.

NREI: Do you think the outbreak might affect the co-living sector the same way it affected the co-working sector?

Gregg Christiansen: No, I think it’s going to be much more resilient. So, co-working [operators basically have] little one- and two-person glass wall rooms that break up a floor plate and stuff as many people into the smallest square footage as possible for the co-working operator to be able to justify the economics to themselves, and a lot of those leases are set on 30-, 60-, 90-day type of structures. Some of them are longer term, but for the most part, they’re pretty short-term leases, with a majority of tenants being small business or entrepreneur-type of individuals. So, in a COVID-19 world, where entrepreneurship is going to be put on pause, you’re going to see a lot of small businesses probably not make it. So, filtering back to the co-working space, the co-working space is going to be the first line to really get hit pretty hard. [It’s going to be] anybody really with short-term lease structures, so you take the hotel industry, the short-term stay industry, co-working industry, and they’ve been probably the hardest hit right out of the gate because of COVID-19. If everybody stops paying rent, people are going to try to get out of their office leases.

The thing about co-living is it’s where people live. It’s where you go home every night. It’s your place of being. It’s where your friends and family know you’re at. So, we’ve actually seen co-living be much more resilient than co-working because those are two very different industries. They get associated with each other a little bit because of the ‘co’ and the sharing economy concept, but when it comes to where someone lives, I think that they take it much more personally and it requires us as a co-living operator to really treat them with the dignity they deserve.

NREI: Has the technology co-living operations use been able to help solve the need for social distancing?

Gregg Christiansen: As we were building out our platform earlier, there were a couple things that we saw as a need to communicate and interact with our resident population, but also to make the ease of living much more accessible. We created an app, it’s called the Ollie Living app, and in that, we have the ability to send out notifications, residents can turn on or turn off services, they can ask for maintenance requests, pay the rent, they can sign up for our social calendar.

Immediately after COVID-19 hit, what we had to do as a team, and something I was very proud of with our team, was create a virtual social network where everybody is allowed to go on and sign up for events. Our Ollie social events would typically be in the building, or a local cooking class, or at a yoga studio, but we’ve transitioned our social calendar into more of a virtual social concept. We have cooking classes now online and we do yoga through Instagram. So, we try to still create the feeling of our social calendar, just through our technology that we’ve created. I think that’s actually been extremely beneficial to have that available for our residents, and we’ve actually seen a pretty good participation rate with our residents staying at home.

NREI: Any guidance you can provide on occupancy rates and move-in rates? Is there a concern around those metrics if the lockdown persists?

Gregg Christiansen: I don’t think we have enough data yet to be able to see if there is going to be a concern. We have four different existing assets that are open and operating, we have two more that are under construction, and so, what we’re seeing in New York is we’re still seeing people sign leases. We have the ability to do virtual tours. All of our applications are all on the internet. You can go on and sign a full lease just through the website and do a virtual tour and never have to ever touch a property. So, that’s great. What we have also been able to develop is a roommate-matching software platform that allows people to find other people to live with. So, even if they are not able to go to the property, they’re actually able to create and form a household on our roommate platform virtually.

Occupancy for us is really stuck at above 90 percent ever since COVID-19 hit. Our Pittsburgh asset had a tick-up of about five percent in occupancy once you saw the universities shut down. Then our property in Long Island City is close to 90 percent occupancy now. So, we’re actually seeing positive movement so far.

If [lockdowns] persists for two, three, four months longer, I think a lot of multifamily projects are going to start to see some weakening in occupancy. I don’t think co-living or even standard apartment buildings are going to be completely isolated from that impact, it would be something that we would all have to rally around. But people are already talking about opening the economy again a month from now and we’re starting to see states open back up, so knock on wood, hopefully we don’t get to the point where we’re in July and August and we’re still in this isolation situation. I think the benefit of our properties is that we have long-term leases, so for the most part we have seen occupancy stay above 90 percent since COVID-19 hit.

NREI: Are co-living properties still attracting investor dollars? Is that mood changing?

Gregg Christiansen: I think it’s a little too early to tell. I think what we’re going to have to get over is the perception that densification might be more criticized than before. I think people are going to want to see that play out a little bit. What we’ve seen in the real estate industry generally is everybody has put their pencils down for the time being from buying or developing or pushing forward new investment ideas across the spectrum. Whether that’s an office or industrial or multifamily [asset, and] retail especially, people have [pressed] pause to see what the world looks like in a post COVID-19 world. I think co-living is not an exception to that rule. It was a growing niche and people were starting to give it the right attention at the end of 2019, heading into 2020. We were starting to see our pipeline really pick up. So, we were pretty excited about where things were going.

But what we are actually probably going to see is some deals and some development projects either see some issues in financing or delays or certain management companies just not survive. Some portions of businesses will have some failed launches, or some failed start-ups, and I think co-living is not going to be immune to that either. So, we’re paying attention to that a bit.

Our investors are a bit longer term investors, they’ve been supporting us really since 2017. So, we’re pretty excited about where we’re going. Co-living is a niche and niche industries are generally the first to be put on the backburner when there is a recession. I think what co-living has going for it though is we are more flexible and have leaner kinds of platforms. So, we’re actually able to jump into buildings and help out much quicker than your standard co-type of industry.

NREI: Are there any other trends developing that you feel are worth keeping tabs on?

Chris Christiansen: I think a couple of things. I think you should be paying attention to delinquencies. That’s something that we’re really watching pretty closely. Just because we have long-term leases doesn’t mean necessarily that everyone is going to pay rent. I think the short-term stays sector is really something to focus on. What we’ve seen so far is our delinquency rates in our co-living units have actually stayed at or slightly above the conventional properties that we’re operating in. So, that’s great. But we’ll obviously have to monitor that pretty closely here soon. And then looking at how governments are going to respond to densification.

Source: NREI

May 07 No Comments

What CRE Will Look Like as America Reopens

Author: Admin

Categories: Commercial News

The United States has had more than 1 million confirmed COVID-19 cases, with a death count approaching 70,000, as of Monday. And new reporting from the New York Times revealed that the Trump administration is “privately projecting a steady rise in the number of cases and deaths from the coronavirus over the next several weeks, reaching about 3,000 daily deaths on June 1 […] nearly double from the current level of about 1,750.”

The Federal Emergency Management Agency, meanwhile, is forecasting “about 200,000 new cases each day by the end of the month, up from about 25,000 cases now,” according to the Times.

So while some cities and states have begun to relax “stay at home” orders in recent days, those numbers shed doubt on whether the U.S. as a whole is on a steady path toward reopening yet.

Still, at some point the worst of the pandemic will subside. When it does, we will not be returning to the same world. That has sparked many discussions in the commercial real estate industry as to what a post-COVID-19 landscape will look like and what that will mean for the various sub-sectors in the industry. How we use buildings will change. That means layouts, density and uses will have to evolve in order to allow for people to safely come back. As just one example, restaurants will not be able to squeeze tables as tightly together as they did previously. Not many people will be willing to eat meals while rubbing elbows with fellow diners as we used to.

There will be universal changes. Temperature checks might become the norm to enter any business. Masks could be required for a while. Hours of operation may be altered to allow for staggering the workday to reduce density. We will also see an increased premium placed on cleaning and hygiene.

“All of the sustainability certification systems–including LEED and WELL–prioritize indoor air quality for the health of the occupants of buildings, but reducing air filter quality was a common strategy in non-certified projects for saving construction costs because most people would not notice or care about the difference. In the post-COVID-19 world, the quality of the air that we breathe in our homes matters, even if we cannot physically see or feel it,” says Benjamin Kasdan, AIA, LEED AP, principal, KTGY Architecture + Planning.

In other ways, though, it’s not so much a reimagination of commercial real estate, but an acceleration of trends that had already begun to emerge.

“While the pandemic and its associated stay-at-home orders have suddenly and unexpectedly interrupted all of our lives, many of the architectural design impacts that will ‘result from’ the pandemic were actually already growing trends for contemporary residential design,” Kasdan says. “In particular, we expect the emphasis on building healthy communities to continue to gain momentum as a result of this shared experience, as will a renewed interest in self-reliant design strategies and resilience.”

Source: NREI

May 05 No Comments

Commercial Leases In The Era Of COVID-19

Author: Admin

Categories: Commercial News,Leasing,Trends

Commercial real estate is poised to be hit especially hard by COVID-19.

While homeowners and renters have their own worries, commercial owners and their tenants are anxiously navigating their way through a morass of decimated income levels and unpayable rent, the path fogged-over by the novelty and unique horror of the current situation.

Now two months into the COVID-19 nightmare, commercial mortgage specialists are still being asked many of the same lease-related questions by their clients. MPA reached out to three of the partners in the New York office of Quinn Emanuel Urquhart & Sullivan, LLP, Andrew J. Rossman, Christopher D. Kercher, and Rollo Baker, to get some answers.

MPA: Has the government adopted any measures to help commercial tenants?

Andrew J. Rossman: Yes. While the federal government hasn’t adopted any comprehensive relief from rent obligations, various government entities have enacted mandates intended to prevent eviction due to coronavirus-related business disruptions.

For example, New York has paused commercial evictions and ordered state-regulated financial institutions to grant 90-day forbearance relief to some borrowers financially impacted by the COVID-19 pandemic. California has authorized local governments to suspend commercial evictions based on nonpayment of rent caused by a substantial decrease in business income related to COVID-19. Los Angeles has issued an ordinance temporarily prohibiting landlords from evicting commercial tenants for failure to pay rent during the ongoing crisis, though this does not apply to large or publicly traded companies. Seattle, Miami-Dade County, and Cook County have closed their Courts to eviction proceedings, effectively suspending evictions in those jurisdictions.

If tenants can access some of the $350 billion in small business loans contained in the federal CARES, they may be used to pay rent and other obligations. Some states are offering their own subsidized loans, too. Pennsylvania launched a small business relief fund to extend zero-interest loans of up to $100,000 to small businesses.

MPA: Does the law excuse a commercial tenant’s obligation to pay rent?

Christopher D. Kercher: Maybe. In the absence of more comprehensive debt relief measures, commercial tenants and their landlords should examine their written lease agreements to assess rent obligations during the pandemic. Tenants should review force majeure provisions that may be in their lease. Where a tenant’s operation of its business is prohibited by law, that tenant may be excused from lease terms relating to hours of operation or allowing access to the property.

Tenants should also assess whether their leases include provisions excusing or reducing rent obligations when there has been a “governmental taking” or “casualty” to the premises, and whether the pandemic and related government shutdown regulations could qualify.

MPA: Are there other potential defenses tenants can leverage?

Kercher: Potentially, particularly the legal doctrines of “frustration of purpose” and “temporary impracticability.” Generally, these doctrines apply when unforeseen, intervening events the contracting parties assumed would not happen deprive a party of the contractual benefit, defeating the purpose for the contract.

MPA: If a business is forced to close because of shutdown orders, could the “takings” provision in a lease provide a commercial tenant with some form of rent relief?

Rollo Baker: That’s an interesting question. Sometimes leases include clauses that provide for rent abatement or lease termination if there is a “government taking” of all or a portion of the premises. People are naturally wondering if government shutdown orders, which bar the use of the leased premises, count as “government takings” under the lease.

The Takings Clause of the Fifth Amendment of the Constitution requires “just compensation” when the government takes private property for public use. Courts have recognized that government restrictions on property rights, short of actually seizing property, may constitute a taking when the restrictions undermine the property’s economic value. However, courts have also held that the government’s exercise of “police power” to protect public health and safety does not constitute a “taking.”

State constitutions and state statutes may be more protective of property rights. Some state courts have held that quarantines destroying vegetation to stop disease are takings, requiring just compensation. Some state courts have also held that temporarily denying people the right to access their property constitutes a “regulatory taking” under their own state constitutions. This is a complicated body of law. It may prove fertile ground for negotiation and, if unsuccessful, litigation.

MPA: Does the denial of the “quiet enjoyment” of a space mean a tenant can stop paying rent?

Kercher: Probably not. Commercial tenants who are barred from use of their leased premises sometimes have a viable claim for breach of the covenant of quiet enjoyment, or possibly constructive eviction. But if the landlord is a private party not responsible for the regulations imposed on its tenants’ business operations, it is unlikely that the landlord can be held liable.

Baker: And many commercial leases condition the tenant’s right to quiet enjoyment on its payment of rent.

MPA: If tenants aren’t able to pay rent, what does that mean for the owners’ mortgage payments?

Rossman: There might be some relief for them. The federal government has encouraged lenders to grant voluntary extensions to borrowers impacted by COVID-19. To facilitate such agreements, the government has adopted orders temporarily limiting reporting, accounting, and regulatory compliance. Some banks and other lenders have announced programs for assisting eligible debtors and are waiving service and late fees, offering credit line increases, and approving collection forbearance for up to 90 days.

Baker: Several states have adopted measures requiring banks to grant forbearance under certain circumstances on debt obligations based on hardship. For example, New York Governor Cuomo’s Executive Order No. 202.9 provides that “it shall be deemed an unsafe and unsound business practice if, in response to the COVID-19 pandemic, any bank … shall not grant a forbearance to any person or business who has a financial hardship as a result of the COVID-19 pandemic.” Other states could follow suit.

Kercher: Landlords should look at their debt documents to assess whether they can invoke common law doctrines, such as “temporary impracticability,” to gain a near-term reprieve from debt collection. Every lease has unique terms, and both landlords and tenants should seek legal advice prior to taking any course of action. The economic shutdown does not mean a shutdown of choices under the law.

Source: Mortgage Professional America

May 02 No Comments

Lease Insurance Could Come Into Play Amid COVID Crisis

Author: Admin

Categories: Commercial News,Leasing,Multifamily

Millions of apartment renters across the U.S. have lost jobs and income in the economic crisis caused by the spread of the novel coronavirus. Many are working with landlords by making partial payments and creating payments plans.

But another aspect of the industry is being tested by the crisis: lease insurance products that have replaced security deposits for some renters.

Founded in 2015, Leaselock provides lease insurance that covers damages and lost rent for roughly one million apartment units. At the properties that use LeaseLock, renters don’t have to provide a security deposit to move in. Instead, they pay a deposit waiver fee of $29 a month for a standard lease insurance policy. In return, LeaseLock agrees to insure the property and pay for potential losses on the apartment, including up to $500 in damages and $5,000 in lost rent—or even $7,500 in high rent markets.

LeaseLock does not carry to risk of these policies itself, but sells the risk to reinsurance companies. Claims on LeaseLock’s lease insurance are triggered when a lease is terminated with damages or an unpaid balance owed. So far these reinsurance companies have not significantly raised their prices for new policies.

“It works well for the resident and it works well for the managers,” says Rick Haughey, vice president of industry technology initiatives for NMHC. ”But how do you price that risk and has that changed?”

More than 26 million people have filed for unemployment in the five weeks since cities and state began to order non-essential businesses to close and residents to shelter in place to the slow the spread of the novel coronavirus.

“There’s risk attached to every renter now,” says Mark Stringer, executive vice president for Avenue5, an apartment company with 70,000 units under management, including thousands covered by LeaseLock. “In the past, you may have had some owners say, ‘Well, we have residents that never lose their jobs so we don’t have to worry.’ Well, now you have to worry.”

For April, the effects have been relatively muted.

The amount of rental income collected by apartment companies in April 2020 dropped 7 percent compared to the monthly average set earlier this year, according to LeaseLock.

That’s similar to National Multifamily Housing Council’s rent payment tracker which found that 89 percent of apartment households made a full or partial rent payment by April 19 in its survey of 11.5 million units of professionally managed apartment units across the country.

“It is not as dismal as we thought it was going to look in April,” says Reichen Kuhl, president, founder and chief of insurance and legal for LeaseLock, “Renters who can pay have paid.”

Numbers for May are expected to be worse, however.

Meanwhile, LeaseLock is helping its clients negotiate with residents who are having trouble.

“Right now, 100 percent of people having trouble are being offered concessions,” Kuhl says. “Almost all of these are good, steadily-paying residents, and apartment companies want to keep good stable residents in place.”

So far, renters in trouble seem to be taking these deals, according to early data from cities where the coronavirus struck first. In Seattle and Los Angeles, which issued “stay at home” orders relatively early, the share of people who paid only part of the April rent is much higher—and the amounts being paid seem to match the “50 percent” being offered by many apartment companies, according to LeaseLock.

“We did see a concerted shift towards partial payments,” says Rochelle Bailis, vice president for LeaseLock. “That shift was pretty dramatic in the hardest hit cities.”

For example, Irvine Company is enabling renters to defer 50 percent of their April and May rent payments over a six-month period, interest-free. All renters have to do is “request rent assist” to create a new payment schedule.

Many other apartment companies have halted evictions and offered similar plans – following the advice of trade groups, including both the National Multifamily Housing Council and the National Apartment Association.

Usually, when a renter is more than a month late in paying rent, the property manager will issue a “pay or quit” notice demanding payment. Cities, states and federal agencies have also created moratoriums on evictions covering a wide patchwork of jurisdictions.

All this comes as lawmakers consider further regulating or even outlawing security deposits, which may push more of the industry towards companies like LeaseLock, or the creation of their own installment plans.

“States are putting more regulations on security deposits,” says Rick Haughey, vice president of industry technology initiatives for NMHC. Legislators argue that having to pay a security deposit can be a barrier for many people to renting an apartment. “Most people just don’t have two month’s rent,” says Haughey.

In Cincinnati, Ohio, landlords must now offer renter alternatives to paying a security deposit, according to that city’s new Renter’s Choice Law, which went into effect in April 2020. Lawmakers in Philadelphia have proposed legislation (House Bill 2427) that could lay the groundwork for total deposit replacement, according to Kuhl. Other new rules include limits on the amount property managers can collect as security deposits, how the money is held in escrow and in some places requirements that the deposit can be paid in installments.

Source: NREI

Apr 30 No Comments

Unpacking the Federal Stimulus Package With Real Estate Roundtable CEO Jeff DeBoer

Author: Admin

Categories: Commercial News,Development

The CARES Act is a massive stimulus bill designed to keep the economy afloat by offering increased unemployment benefits to Americans, loans to companies to keep up payroll and more.

Since this program was passed, commercial real estate professionals have had one thought on their minds: How will this help CRE?

Real Estate Roundtable CEO Jeff DeBoer has been trying to answer that question by working with property owners, lenders and tenants to unpack what the program means for CRE. DeBoer is a 35-year industry veteran who has appeared on Fox News, Bloomberg Television, MSNBC and CNBC advocating for the real estate industry. Real Estate Roundtable has also developed its own COVID-19 Resource Center and has been working on a variety of policy responses designed to help employers maintain payrolls, support new credit facilities from the Fed to assist the CMBS market and more.

Join Bisnow as we speak with DeBoer about the top issues he is lobbying for right now, his feelings on the recent aid packages and what he would change, what he believes is needed to help the CRE industry stay afloat during this difficult time and what we can do to help. There will also be time for questions. This free Bisnow webinar will take place April 30 at noon ET. Register HERE.

Jeff DeBoer is the founding president and CEO of The Real Estate Roundtable, a nonprofit public policy organization based in Washington, D.C., that represents the interests of the nation’s top 150 privately owned and publicly held real estate development, lending and management firms. Roundtable member portfolios contain over 12B SF of office, retail and industrial properties. For the past 35 years, DeBoer has been advocating for the real estate industry on television, in print and in Washington. Along with his role at The Real Estate Roundtable, DeBoer also chairs the National Real Estate Organization, is chairman of the Real Estate Industry Information Sharing and Analysis Center, and has been included in Washington Life Magazine’s list of Washington’s most influential unelected, non-governmental people and The Hill’s list of top lobbyists in D.C.

Source: Bisnow

Apr 28 No Comments

South Florida Real Estate Leaders Confident About The Market, Despite Pandemic

Author: Admin

Categories: Commercial News,Development,Leasing,Multifamily,Offices,Retail,Shopping Centers,Trends

Despite the challenges caused by the coronavirus pandemic, a panel of five South Florida real estate veterans said Wednesday they feel optimistic about the market.

The webinar, called “Lessons from the Past,” featured professionals who managed their firms during the Great Recession and are using those experiences to inform current strategies.

On the panel were developers Adolfo Henriques, vice chairman of Related Group, and Masoud Shojaee, chairman of Shoma Group; Al Dotson Jr., managing partner of Bilzin Sumberg law firm; Bruce Moldow, CFO of Moss Construction, and Judy Zeder, Realtor-Associate with the JillsZeder Group.

The event was hosted by the Miami Herald’s RE|source Miami newsletter; a recording is available online at https://bit.ly/2KsJPZS. (Password: 7i*=$s7@)

Source: Miami Herald

Apr 27 No Comments

Warnings Multiply As South Florida Retail Landlords Brace For Coronavirus Fallout

Author: Admin

Categories: Commercial News,Retail,Shopping Centers,Trends

Owners of the nation’s malls, retail plazas and Main Street storefronts are sounding alarms over the magnitude of the financial wreckage in store for the U.S. economy as efforts to contain the coronavirus appear destined for a prolonged slog.

The clearest sign to date of the pandemic’s potential to inflict deep and long-term damage was made clear as details emerged last week about thousands of so-called Watch List loans. The disclosures are a monthly ritual on Wall Street to keep investors in commercial mortgage-backed securities apprised of the health of the properties backing their portfolios.

Nearly 700 retail properties ranging from strip malls to stand-alone big-box stores were slapped with the “Watch List” moniker between March 15 and April 15, as the nation rolled out shelter-in-place policies and saw waves of business closures to combat the Covid-19 outbreak. The increase in CMBS properties flagged for concern marked a 45% increase over the number of Watch List retail properties recorded a month earlier.

Click here to read more about this story.

Apr 24 No Comments

The Coronavirus Is Changing Real Estate Sales Contracts. The Shift Looks Permanent

Author: Admin

Categories: Commercial News,Leasing,Trends

The contracts drawn between a seller and buyer in South Florida may never be the same again.

As coronavirus continues to spread, real estate agents are adding a “COVID rider” to existing contracts and including it in new sales. The standard force majeure clauses that protect sellers and buyer in the case of an act of God typically cover only natural disasters like earthquakes, hurricanes and tornado.

Pandemics have not been on the list. That is, until now, said Miltiadis Kastanis, director of luxury sales for Douglas Elliman.

“Yesterday’s contract is not today’s contract. Legal intervention is the smartest thing we can do,” Kastanis said.

Several Realtors say they contacted their attorneys in March, as the crisis was growing, to update pending sales contracts and write new ones that specifically include pandemic or coronavirus as covered reasons for canceling contracts. Kastanis now sends his contracts for approval first to his attorney before sending it to the buyer for review.

The COVID clause protects both the buyer and seller, he said. For the buyer, it gives them more time to complete tasks, including finalizing lending — should a bank have halted lending altogether — or complete an inspection.

It also protects the seller, Kastanis said. “A buyer may say, ‘Well, my bank isn’t lending.’ It may be an excuse for the buyer to walk out.”

It also faciliates contract extensions, said Anthony Askowitz, broker and owner of RE/MAX Advance Realty.

For sellers, such clauses act as a hedge against fluctuations in the market, Askowitz said. “Their home may not have the same value in the future. We know the value from yesterday. We don’t know what the value is going to be after the pandemic.”

The clause may also offer a sense of security to lenders, he said. “This is a protection for banks. Banks need this because it puts things in context of what people can expect. We saw that early on when people wanted to get out of their contracts, this ensured that they couldn’t.”

The addendum or clause is legally binding, said attorney Florentino Gonzalez, co-chair of the downtown Miami-based Shutts & Bowen’s Real Estate Practice Group. If the buyer tried to pull out after all mortgage, appraisal and inspection services are back to normal, “they can risk being sued for specific performance of contracts or lose their deposit,” said Gonzalez.

But because a pandemic can be infinite in nature, Gonzalez said, there will also likely be a deadline for any contract extension.

The addition of the word ‘pandemic’ as a force majeure is here to stay, Kastanis said. “It has shown to impact our market strong enough.”

Source: Miami Herald

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Category: <span>Commercial News</span>

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“The forced interaction of sharing doors and elevators has caused some anxiety,” Youngentob told the Times. “Townhomes, where you come in and out of your door, and you know you are the only one touching your door handle, provide some comfort.”

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“It works well for the resident and it works well for the managers,” says Rick Haughey, vice president of industry technology initiatives for NMHC. ”But how do you price that risk and has that changed?”

“It is not as dismal as we thought it was going to look in April,” says Reichen Kuhl, president, founder and chief of insurance and legal for LeaseLock, “Renters who can pay have paid.”

“Right now, 100 percent of people having trouble are being offered concessions,” Kuhl says. “Almost all of these are good, steadily-paying residents, and apartment companies want to keep good stable residents in place.”

“We did see a concerted shift towards partial payments,” says Rochelle Bailis, vice president for LeaseLock. “That shift was pretty dramatic in the hardest hit cities.”

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“Yesterday’s contract is not today’s contract. Legal intervention is the smartest thing we can do,” Kastanis said.

It also protects the seller, Kastanis said. “A buyer may say, ‘Well, my bank isn’t lending.’ It may be an excuse for the buyer to walk out.”

For sellers, such clauses act as a hedge against fluctuations in the market, Askowitz said. “Their home may not have the same value in the future. We know the value from yesterday. We don’t know what the value is going to be after the pandemic.”

The clause may also offer a sense of security to lenders, he said. “This is a protection for banks. Banks need this because it puts things in context of what people can expect. We saw that early on when people wanted to get out of their contracts, this ensured that they couldn’t.”

The addition of the word ‘pandemic’ as a force majeure is here to stay, Kastanis said. “It has shown to impact our market strong enough.”

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