As we shelter-in-place and watch in amazement how the world changes before our very eyes, there are practical ramifications to what’s happening.
IMPACTS ON COMMERCIAL REAL ESTATE:
Consumers (that’d be you and me) are not going shopping. We’re not headed to our favorite restaurants, or gyms, or car dealers. We’re not visiting dentists or hair salons. Or our favorite saloons either. Investment advisors are working from home, as are accountants, now that Tax Day has been bumped to July… (There’s a not-funny pun about death and taxes in here somewhere.)
So, if your favorite store is not getting its sales dollars from you, how does it pay the Landlord? How does the Landlord pay it’s Lender?
Many states have places a moratorium on evictions, but the rent is still owed. Same with foreclosures on mortgages.
A lot – and I mean a LOT – of people are re-reading their Leases and Loan Documents, All of a sudden that “force majeure” clause is right up front and center. The next thing people are pulling out are their insurance policies.
What’s it all mean? When will it all end? How, and Who, will get the mess cleaned up?
We don’t know. Yet.
VIDEO DISCUSSION: COVID-19 COMMERCIAL LEASE ISSUES
We’ve put together the following video discussion on “Commercial Lease – COVID 19 Issues.”
COVID-19 COMMERCIAL TENANCY AND FORCE MAJEURE WHITEPAPER
We’ve put together the following white paper on “force majeure” and “impossibility” and “frustration of purpose.”
This whitepaper is not, and should not be construed to be, legal advice. It is the writer’s summary of the legal principles which might apply to this “novel” Corona Virus situation.
COVID19 – COMMERCIAL LEASE DECISION MAKING FLOW CHART
We’ve put together the following commercial lease decision making flowchart.
Commercial Leases in the times of COVID-19 ➜ Decision Making Flow Chart ➜ Follow these steps when analyzing your commercial lease non-rent payment issue.
If you find yourself as either a Tenant or a Landlord, and need some guidance, give us a call.
But Wait, There’s More.
IMPACT ON RESIDENTIAL REAL ESTATE:
Landlords and Lenders are not the only ones impacted. There were a lot of purchase agreements out there that were due to close in these last few weeks. What about them?
We’ve put together the following video discussion on “The California Association of Realtors (CAR) Coronavirus form redo”.
C.A.R. Form Redo – Who Gets The Liquidated Damages?
[UPDATE 4/17/20] Yesterday, the California Association of Realtors (CAR)(and the hard-working committee members within it) released revisions to its “CoronaVirus Forms.” The revisions (4.16.2020) address and eliminate or change only a few of the concerns the first round Forms created. I touch on some of the more significant changes here. You should read both this and the earlier (April 2, 2020) Memo when reviewing the new (4.16.2020) CAR Forms.
C.A.R. Residential RE Transactions – New CoronaVirus Forms (April 2, 2020)
The California Association of Realtors (CAR) – an association of which I am a 40 year (or so) member – has been nimble, and prepared forms and Q&As for its real estate licensee constituency, in an effort to offer uniform guidance. As with all things, understanding the impact of what the “Forms” do – is important.