Legislation would provide help to commercial real estate foreclosures

WASHINGTON, D.C. (WTVQ/Press Release) – After hearing from constituents in their congressional districts, U.S. Congressmen and members of the House Committee on Financial Services, Andy Barr, R-Ky, Van Taylor, R-Tex., and Al Lawson, D-Fla., have introduced legislation to provide economic support to the commercial real estate market, especially for businesses with Commercial Mortgage-Backed Securities (CMBS) debt. H.R. 7809, the Helping Open Properties Endeavor (HOPE) Act works to protect millions of jobs across the nation by preventing commercial real estate, specifically to borrowers of commercial mortgages, according to the bill authors. “The COVID-19 pandemic and the ensuing government-imposed shutdown of the economy severely threatened the commercial real estate market,” Barr said. “The HOPE Act is a lifeline for commercial borrowers so they can stay in business, avoid foreclosure, keep their employees on staff and emerge intact on the other side of this crisis.” Specifically, the proposal provides borrowers of commercial mortgages, who have been hit the hardest economically by COVID-19, financial assistance through the HOPE Preferred Equity lending facility. Guaranteed by the Department of the Treasury, financial institutions will originate preferred equity instruments to borrowers. Click to read more at www.wtvq.com.

Designing for the future: How COVID-19 could change offices for good

More than they ever have before, Americans are working from home to follow CDC recommendations about social distancing to slow the spread of COVID-19. The situation is forcing employees and employers to adapt to a kind of new normal. “Connecting with clients and connecting with my team has been different,” says David Euscher, vice president and interior design studio leader at Corgan. “We’re in a very collaborative field and I find that communication is much more scheduled and intentional than when you’re in a studio space together.” Corgan, a global architecture and design firm founded in Texas more than 80 years ago, works with clients internationally to create places “where people thrive and clients succeed.” Projects span a range of categories from offices to healthcare to airports. The company touts clarity, singularity, locality, responsibility and empathy as its design principles. Empathy is something Euscher, who’s based in the firm’s Houston office, says he’s grateful to see more of as American cope with a once-in-a-lifetime challenge. “People are reaching out to one another on a personal level. Checking in on others, just asking, ‘Are you doing OK?” he says. “Everyone’s going through the same thing at the same time and that shared struggle is bringing people together.” Click to read more at www.rednews.com.

The Future of Malls and Commercial Real Estate

OVID-19 drastically affected the financial landscape worldwide. The effects have rippled through every industry, including commercial real estate (CRE). Long-struggling malls and retail stores have taken an especially devastating blow. Between social distancing and consumers cutting discretionary spending, malls simply can’t catch a break. Without loan restructuring and innovative solutions to keep retail stores afloat, malls could become a thing of the past. To predict the future of malls and commercial real estate, it’s important to examine how we got here. Ecommerce: The Original Retail CRE Challenge: In February, the COVID-19 pandemic was mere weeks away from taking hold in the U.S. At the time, retail management company Vend boiled the Ecommerce vs. retail race down to purchase type. “Consumers are making more convenience purchases online,” Francesca Nicasio wrote, “but they’re still making their luxury and experiential purchases in person.” Indeed, retail CRE investors had been closely tracking the growing popularity of Ecommerce. Online sales were predicted to grow from $1.3 trillion in 2014 to $4.5 trillion in 2021, and that was before the pandemic. In response, some CRE investors moved away from retail. Hedge funds found CRE bundles with a high proportion of mall loans and bet against them. Then came the pandemic. Click to read more at www.pioneerrealtycapital.com.

What The Pandemic Has Taught Landlords About Utilizing Technology

Different real estate areas and investment types have been affected in various ways by the Covid-19 pandemic. Short-term rentals and Airbnbs, for example, have been hit hard and many of those properties have forcibly been liquidated. Those investors whose strategies revolved around fix-and-flips or BRRRR (buy, rehab, rent, refinance and repeat) have had to bring properties to market during a period when no one is allowed to physically visit them before making purchasing decisions. Long-term buy-and-hold properties have their own problems, too, with millions of Americans filing for unemployment over the last four months. The single stimulus check received so far was an all-too-temporary relief for many. Thankfully for renters, there are eviction moratoriums across the U.S., but for landlords, this means the weight of the current recession is coming down hard on their shoulders. To address these challenges now and in the future, one emerging trend is the acceleration of proptech adoption for everything from virtual showings to property management. Click to read more at www.forbes.com.

Pandemic compels more technology uptake on construction sites

Necessity may be the mother of invention, but stress is the foreman provoking further innovation. In these stressful times, we’ve already seen a lot of pioneering techniques to safely keep construction sites active. In the months and years ahead, the pandemic will continue to leave its mark on the way we build the world around us. In the larger Texas metros, the COVID-19 emergency has forced some projects to partially or fully suspend operations while others that were set to break ground have been pushed until next year, according to Matt Hoglund, central regional leader and management committee member with DPR Construction. Though some of DPR’s clients have hit the pause button while they evaluate the economic impact of the pandemic on their business models, the vast majority of their projects have progressed forward. DPR instituted a number of safety protocols on active job sites that, in the end, caused minimal impacts and allowed work to forge ahead. “Construction involves mitigating hazards under normal circumstances and COVID-19 prevention is now a new hazard taken into consideration in planning daily work, labor needs and PPE,” said Hoglund. “As a result, construction has proceeded consistently in most areas, with even some additional work being added by our healthcare teams as our customers seek their own solutions as a result of the pandemic.” Click to read more at www.rejournals.com.

Congressman pitching high-risk lifeline for CRE

A real estate financier turned U.S. representative is leading the charge to give the commercial real estate industry a lifeline — albeit a risky one for the government. Texas Republican Rep. Nicholas Van Taylor plans to introduce a bill that would authorize the Treasury Department to provide real estate investors hit by the pandemic with low-cost financing to support their properties, according to real estate attorneys briefed on the proposal. “The idea is that the real estate industry is experiencing real pain. This would help get through this rough patch,” Bruce Stachenfeld, chairman of the New York real estate law firm Duval & Stachenfeld, told The Real Deal. The Helping Open Properties Endeavor (HOPE) Act of 2020 aims to help avoid a wave of foreclosures, according to Stachenfeld, whose firm was briefed on the proposal by Van Taylor’s staff. The program would be open to investors in good standing before the pandemic hit, with no loan defaults before March 1. It would provide real estate owners with something similar to a very low-cost loan: Borrowers could take on as much as 10 percent of their existing debt at a rate as low as 2.5 percent. That could be a boon for struggling real estate investments, particularly when traditional rescue capital charges around 10 percent, industry experts said. Click to read more at the www.therealdeal.com.