“COVID-19 has commercial real estate tied in knots, as lockdowns ease in New York City and other major cities”
The coronavirus pandemic’s toll on the estimated $16 trillion U.S. commercial real-estate market has only begun to show as buildings start reopening in major cities and properties emerge from months of mass shutdowns.
…“A lot of corporate tenants are parsing their leases and trying to renegotiate, either for less rent or less space, or even to terminate their lease,” said William O’Connor, a partner at Thompson & Knight LLC, who focuses on real estate workouts.
“Some tenants are willing to make a lump-sum payment and move on,” O’Connor told MarketWatch, adding that several landlords have been offering free-rent to firms willing to sign up for 10-year leases.
“That matches the type of debt they’d be taking out,” he said, pointing to the 10-year term of many U.S. commercial real-estate loans.