- Neiman Marcus, the Retailer to the Rich, Stumbles into Bankruptcy “A Texas oil boom turned a single Neiman Marcus department store in downtown Dallas into one of America’s biggest luxury retailers. A century later, the new coronavirus tipped the heavily indebted company into a bankruptcy court. Neiman Marcus Group Inc. filed for chapter 11 bankruptcy protection on Thursday in Texas, becoming the latest large retailer to seek a court restructuring during the pandemic that has closed much of the U.S. economy. Earlier this week, J.Crew Group Inc. filed for bankruptcy.” (Wall Street Journal, subscription required)
- As Restaurants Remain Shuttered, American Cities Fear the Future “The nation’s cities are peppered with neighborhoods just like it — areas animated in recent years by a huge restaurant boom. In any one of them, the failure of even a few key independent restaurants could spell devastation for their local economies. While the federal government has created a program to help small businesses, including restaurants, many were largely unable to gain access to the first tranche of $349 billion before the money was depleted.” (The New York Times)
- Push for Profits Left Nursing Home Industry Struggling to Provide Care “When the pandemic struck, the majority of the nation’s nursing homes were losing money, some were falling into disrepair, and others were struggling to attract new occupants, leaving many of them ill equipped to protect workers and residents as the coronavirus raged through their properties. Their troubled state was years in the making. Decades of ownership by private equity and other private investment firms left many nursing homes with staggering bills and razor-thin margins, while competition from home care attendants and assisted-living facilities further gutted their business.” (The New York Times)
- One Important Sector of the Real Estate Industry Is Back in Business “When the coronavirus pandemic first forced states to issue stay-at-home orders, so-called iBuyer companies quickly stopped purchasing homes in anticipation of major upheavals in the U.S. housing market. But now two of those companies are resuming operations. Offerpad, a company that specializes in buying homes directly from sellers and then turning them around quickly to be resold, said that it will begin fielding offers from home buyers, sellers and real-estate agents again starting May 8 in more than 800 cities across the country.” (MarketWatch)
- Lease Dispute Leads to Lawsuit at SF Building Partially Owned by Trump “An office leasing dispute has sparked a lawsuit at a San Francisco building partially owned by President Donald Trump’s family business. Co-working giant Regus walked away from a 15-year lease worth $90 million at 345 Montgomery St., the former Bank of America banking center. Landlord Vornado sued, claiming that Regus violated a leasing agreement, according to a Securities and Exchange Commission filing this week.” (San Francisco Chronicle)
- Wynn Resorts Details Coronavirus Damage “Las Vegas-based Wynn Resorts Ltd. reported a net loss and a sharp drop in revenue, the latest casino operator to reveal how coronavirus shutdowns are hurting the gambling industry. On Wednesday, Wynn Resorts said operating revenue declined 42% to nearly $954 million for the three months that ended March 31, down from $1.65 billion a year earlier. The company had a net loss of $402 million for the quarter, compared with net income of nearly $105 million a year earlier.” (Wall Street Journal, subscription required)
- Inside a Billionaire-Owned Nursing Home Chain: ‘We Are the Landlocked Cruise Ships’ “Crystal Cunneen was one of three people working on her floor in a Littleton, Massachusetts nursing home on April 1. The 34-year-old nurse says that before COVID-19 hit the facility, she used to have at least 14 coworkers by her side. That day, many were either sick or did not show up. ‘I left the building, I walked to go into my car in tears. The director of nurses pulled up next to me and said ‘We are a sinking ship. I need you back in there. We need you. You’re a hero.’” (Forbes)
- Tomorrow’s Jobs Report Will Be Bad. What’s Next for CRE? “Preliminary U.S. jobs figures for April are dropping in tomorrow morning, the general consensus being that we’ll be looking at a double-digit unemployment rate for the first time since October 2009. As real estate braces for more figures that will be difficult for even the most hardened investor to digest, the big question is how long will it take for the market to snap back. Since the crisis began, more than 30 million Americans filed initial unemployment claims, accounting for about 20 percent of the country’s workforce.” (Commercial Property Executive)
- Kohl’s to Reopen 25% of Stores as States Lift Lockdown Restrictions “Kohl’s Corp said on Thursday it plans to reopen a quarter of its stores by next week, as retailers start to get business going again in states where coronavirus-induced lockdown restrictions have eased. The department store operator said stores in four U.S. states had already reopened earlier this week and outlets in 10 more states would open on Monday. Cosmetics retailer Ulta Beauty also said it would reopen about 180 stores on Monday.” (Reuters)
- Massive Downtown L.A. Office Complex Gets $550M CMBS Refinance “One theme of the COVID-19 era in commercial real estate is that robust sponsors with strong assets will still get the financing they need, despite freezes in certain financial sub sectors. The owners of the twin skyscrapers that make up the 2.5-million-square-foot office complex City National Plaza in Los Angeles’ Financial District have nabbed $550 million in commercial mortgage-backed securities (CMBS) debt to refinance the property, according to ratings agency analysis of the transaction.” (Commercial Observer)
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