Top Commercial Real Estate Industry Leaders Speak Out About the Impact of the Coronavirus
I was invited to participate in a high-level industry teleconference, where leaders from the ownership, lending, and legal specialties within our industry were giving their experiences, observations, and recommendations around the impact that the coronavirus has been having on our industry.
These participants asked that their names not be disclosed to anyone outside of the live teleconference, and here is a summary of the major points that they discussed during the teleconference:
- One major national retail tenant is now claiming that they can terminate all of their leases because of clauses in them regarding specific actions that may be taken by our government, and they believe that the government action that’s now been taken around the coronavirus has now triggered their right to cancel their leases.
- Owners are getting letters from national tenants, saying that they won’t be paying their rent for the next 90 days.
- One ownership company on the call has gotten their lender to now agree to accepting interest only payments in the interim on their loans for the next 90 days.
- Some well-known property owners will not be making their next loan payments, and others will still be making them, because they understand that not making them will then jeopardize their future ability to get loans from any lenders within our industry.
- One ownership group has now obtained a 90-day deferral on making any payments to their lender.
- It’s important to be current in making payments on your loan when you ask for deferments and workouts from your lender, otherwise your loan could then get reclassified as being delinquent.
- You will have a tough time getting any judge to agree that your tenant should be paying you the full amount of their rent right now.