One Big Thing
California’s eviction moratorium is scheduled to expire in early February. A new assembly bill is seeking to extend it through the end of 2021. Concurrently another assembly bill is attempting to establish a framework for dispersing rental relief. (h/t Steve Sims) Connect Media Two comments here:
- While I’m not in favor of a one sided solution – nothing here addresses landlord mortgages and default protection if tenants stop paying – this would be MUCH more palatable if it established extension provisions of 60-90 days rather than arbitrarily setting the timeline at a fully year, especially with the vaccination roll-out beginning. However, as Prop 15 showed, we do not incremental legislation well here in California. It’s all or nothing.
- An eviction moratorium of that sort of length without direct rental relief is ultimately a suicide pact for tenants and landlords – and I’m not talking about just establishing a framework, it has to be real. The landlords will suffer first as they are unable to pay their operating expenses and mortgages, ultimately losing their properties. The tenants will suffer later when the moratorium expires and eviction proceedings begin. Then will wind up saddled with a mountain of unpaid rental debt and left with few options other than personal bankruptcy.
TL;DR any moratorium must be countered with rental assistance or it will be a slow motion train wreck for both landlords and tenants.
What I’m Reading
On the Ropes: The National Restaurant Association has sent a letter to Congressional leadership in which it argues that the entire industry needs a ‘down payment’ relief bill to make it to the new year. Dumb, anti-science mandates like California banning outdoor dining will only make things worse and hurts these small businesses in favor of Silicon Valley giants that benefit from delivery. Chain Store Age
Called Out: WeWork has been accused of “actual or imminent” financial insolvency by one of its largest commercial real estate landlords in the Washington DC amid a larger, multimillion-dollar legal feud over rent and promised tenant improvement costs. Who could have ever seen this coming? Washington Business Journal
High Demand: The pandemic has largely spared the property management sector of any substantial layoffs. However, job demands from establishing and enforcing safety protocols to higher cleaning standards to advising nervous building occupants have increased workloads substantially. Bisnow See Also: Office landlords face a steep climb in reducing operational costs to counter occupancy trends at a time when they are also trying to manage the pandemic. Globe Street
Big Shift: The pandemic is accelerating a shift in the labor market to warehouse and delivery jobs supporting ecommerce as shopping preference changes accelerate. Wall Street Journal
Back to Earth? Video Conferencing company Zoom was arguably the biggest winner of the pandemic. At this time last year, Zoom had on average 10 million daily meeting participants. It now has 350 million. However, the combination of a COVID vaccine and larger tech platforms making improvements to their video conference platforms may mean that Zoom is nearing its saturation point. Vox
Chart of the Day
This has a whole lot to do with a lack of childcare options resulting from school closings.
Source: @SoberLook
WTF
Lost Wages: Hookers are suing the state of Nevada for mandating that brothels stay closed during COVID. They have a point here, TBH. COVID is probably the disease of least concern if you are patronizing a brothel in the middle of Nevada. NY Post
Problem Solvers: A porn site has formally extended an offer to NBA and its players to partner with the site to help keep players away from strip clubs after superstar James Harden was caught mask-less making it rain in Vegas. Complex
Basis Points – A candid look at the economy, real estate, and other things sometimes related.
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