Some big U.S. retail and restaurant chains, including Mattress Firm and Subway, are telling landlords
that they’ll withhold or cut rent in coming months after stores
temporarily closed to slow the spread of the coronavirus, Bloomberg
reports, citing people familiar with the situation.
The chains are calling for rent cuts through lease amendments and other measures starting in April.
The U.S. relief packages being discussed don’t
directly address rents. However, the Fed’s actions may give banks the
space to defer mortgage payments, allowing property owners to delay rent
collection.
It’s unclear if retailers can declare “force
majeure”, a contract clause covering highly unusual events, and if
landlords can make that same argument to insurers.
Some landlords are trying to help smaller tenants.
Irvine Company Retail Properties is allowing rent to be deferred for 90
days then paid back with no interest over a year starting in January,
Bloomberg reports.
Bank of America downgraded several REITs this
week, saying they may need to provide some leeway on rent. BofA sees
store closings lasting through may with the possibility that weaker
retailers won’t be able to return.
These players don’t necessarily rent to Subway or Mattress Firm, but might be dealing with similar issues: O, VER, STOR, NNN, SRC
https://seekingalpha.com/news/3554803-big-retail-restaurant-chains-angle-for-rent-cuts-bloomberg
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