“Overwhelming majority” of Brooklyn retailers asking for rent relief: report

About half of retailers made this request indefinitely, according to TerraCRG report

TRD New York /
Apr.April 15, 2020 03:45 PM
A deserted Brooklyn retail corridor along 4th Avenue in Park Slope (Credit: Google Maps)

A deserted Brooklyn retail corridor along 4th Avenue in Park Slope (Credit: Google Maps)

Retail tenants in Brooklyn are requesting rent help from their landlords in droves as the pandemic rages on and forces many stores to shut down indefinitely, according to a report from TerraCRG.

The report detailed responses from 80 retail property owners. About two-thirds of the landlords surveyed said between 75 and 100 percent of their retail tenants had asked for rent deferrals or forgiveness. About 12.5 percent said they received the request from 50 to 75 percent of tenants.

Almost half of the landlords said their tenants asked them for indefinite rent relief, while 37.5 percent said tenants asked them for an average of three months. And almost 80 percent said they had not developed a portfolio-wide policy for rent relief but were instead dealing with it on a case-by-case basis.

New York State halted all evictions on March 15 in response to the pandemic, but the state has not yet implemented any rules or guidance regarding rent moratoriums.

A common refrain in real estate since the pandemic picked up speed has been that tenants not paying rent would just be part of a chain reaction that could lead to landlords not paying their mortgages, which could in turn lead to bank failures. TerraCRG found a roughly even split when it came to retail landlords asking their lenders for more time to make mortgage payments, with 35 percent saying they had asked for more time, 36.2 percent saying they had not, and 28.7 percent saying such requests were still in progress.

For the landlords who did ask for additional time, just over half said their lenders had “somewhat” worked with them to address their situation. Just 14.8 percent responded with an outright yes, and 33.3 percent said the lenders had not worked with them.

And most landlords were not especially hopeful about the situation turning around quickly, with more than 60 percent saying they were not very optimistic about a “V-shaped” economic recovery after the pandemic.

TerraCRG founder Ofer Cohen said his firm got the general impression that people on all sides of the retail equation were trying to be reasonable and accommodating during the crisis.

“Everybody has been trying to be very cooperative on both the tenancy and the ownership side,” he said, “and I think what this data suggests is that this is a very much market-wide problem.”

Retail had already been struggling before multiple “stay at home” orders forced businesses in Brooklyn and across the country to close their doors indefinitely. While Cohen said he does not think that the pandemic will lead to the end of retail as we know it, he did predict that it will spark at least some closures.

“The retail that did struggle, or the retail that was borderline struggling, I’m assuming that this event is definitely going to push them over the edge,” he said.


Related Articles

arrow_forward_ios
Bozeman, Montana

Montana’s real estate market shows no signs of cooling heading into winter

Montana’s real estate market shows no signs of cooling heading into winter
An aerial view of a pop-up drive-in theater built in the parking lot at the Broadway Commons in Hicksville, New York (Getty)

Covid pummeled shopping centers, but their parking lots are thriving

Covid pummeled shopping centers, but their parking lots are thriving
The number of mortgage borrowers in Covid-19 forbearance plans ticked down again this week. (iStock)

3M homeowners remain in forbearance

3M homeowners remain in forbearance
Mayor Bill de Blasio and the Lucerne Hotel at  201 West 79th Street (Getty; iStock; Google Maps)

Lawsuit blasts NYC’s “capricious” Covid-19 homeless response

Lawsuit blasts NYC’s “capricious” Covid-19 homeless response
Gap CEO Sonia Syngal (Getty)

Gap Inc. will close 350 stores and exit malls entirely

Gap Inc. will close 350 stores and exit malls entirely
(iStock)

Dead weight: A breakdown of NYC’s rental listing glut

Dead weight: A breakdown of NYC’s rental listing glut
The National Multifamily Housing Council’s monthly payment tracker found that 90.6 percent of those households paid some rent by Oct. 20. (iStock)

Rent collections in market-rate apartments stagnate in October

Rent collections in market-rate apartments stagnate in October
Gov. Andrew Cuomo (Getty; iStock)

New York City lifts lockdown for some Covid hot spots

New York City lifts lockdown for some Covid hot spots
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...