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Weekly Market Report - October 1, 2020


Protections for commercial tenants

The New York City Council will vote on legislation extending protections for commercial tenants who have been impacted by COVID-19. Businesses throughout the City have been financially hurt by the pandemic, and it has forced closures or reductions in capacity. As a response to this, the Council voted in May 2020 to enact Local Law 55/Intro. 1932 which suspended personal liability provisions in leases of businesses that were required to close as part of the State’s efforts to control the spread of COVID-19. This meant commercial landlords who were not getting rent could not go after a tenant’s personal assets, including their homes.


Manhattan Offices struggle while other cities continue to bring workers in

Manhattan office employees are returning to work at a much slower pace than those in most other major U.S. cities, raising the risk that New York faces a more protracted and painful recovery from the coronavirus pandemic than much of the rest of the country. Wall Street bankers have been trickling back to their glass towers, while real-estate firms have tried to set an example by encouraging staff to return in force. But most of the city’s lawyers, media and publishing employees, tech industry workers and others have stayed away, real-estate brokers say. Overall, about 10% of Manhattan office workers were back as of Sept. 18, according to a real estate group. But this seems to be isolated to only New York City. Nationally, about 25% of office workers have returned as of this month, on average, according to real-estate services firms. Some large metropolitan areas are considerably higher, such as Dallas at 40% and the Los Angeles metro area at 32%, industry professionals say.


NYC Commercial Property Crisis Signals Hazards for Local Banks

Before the pandemic emptied the city, few lenders benefited from the heady local real estate market as much as regional players New York Community Bancorp Inc. and Signature Bank. Now they’re becoming a case study for potential trouble from a sudden downturn in the Big Apple’s property sector, and their share prices are suffering. New York Community Bancorp and Signature were among the top five most-active lenders in New York in the first half of the year, and almost all their portfolios are tied to the area. This highlights the biggest issue of local banks. When all their investments are tied in with local events, it’s hard to survive widespread events that trigger economic decline.


Industry City abandons plan

It was slated to be one of the biggest real estate projects in New York City in years, a major expansion of the Industry City complex on the Brooklyn waterfront that could have created as many as 20,000 jobs at a time when local unemployment has soared because of the pandemic. But on Tuesday night, the project’s owner canceled the expansion in the face of fierce opposition from anti-development groups and individuals, ending the biggest clash over development in the city since the collapse of the Amazon deal in Queens last year, and highlighting the growing influence of the anti-development individuals and groups in local politics.

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