By Corina Vanek | Phoenix Business Journal
As commercial landlords stare down another month of tenants— especially restaurants and retailers — likely missing rent when checks are due on May 1, the chaos has calmed slightly since what happened in April and processes have been put in place to deal with rent relief.
Suzanne Kinney, president and CEO of the Arizona chapter of NAIOP, said the initial onslaught of companies seeking rent relief has subsided as landlords have created forms and other procedures to evaluate each company’s needs and work with them on options available. Those options include tacking on missed rent at the end of a lease or doing “blend and extend” deals that increase the lease term and amortize the missed payments over the longer term.
“They’re all trying to figure out what to expect,” Kinney said of the firm’s members, which are generally developers and owners of office, industrial, retail and mixed-use real estate. “There will be more non-payments, and there is an element of the unknown.”
While landlords likely have been in communication with tenants that requested rent relief, there are possible tenants that had not spoken up before rent was due and who simply did not pay it, she said.
Landlords also have worked with lenders on forbearance or other arrangements as much as possible during the pandemic, Kinney said. However, some loans, such as commercial mortgage-backed securities, or CBMS, are harder to renegotiate than those originated from a local bank. So far, Kinney said, there has not been much direction at the federal level about how those loans will be handled.
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