Sam Zell’s office REIT won’t commit to a specific coronavirus strategy just yet

Equity Commonwealth said rent collection remained strong for the month of April

National /
May.May 05, 2020 12:21 PM
Equity Commonwealth's Sam Zell and David Helfand (Credit: Equity Commonwealth)

Equity Commonwealth’s Sam Zell and David Helfand (Credit: Equity Commonwealth)

Sam Zell’s Equity Commonwealth has not had many problems collecting rent so far, but the company was very light on details about the pandemic’s impact apart from that in its first quarter earnings call on Tuesday morning.

The office real estate investment trust had 98 percent of its contractual rents paid for the month of April, and just 3 percent of that came from security deposits and credit applications, according to CEO David Helfand. He also stressed that the company receives less than 1 percent of its revenue from retail tenants and has no co-working exposure, two sectors that the pandemic has hit especially hard.

Helfand acknowledged that the ongoing pandemic has created an “unprecedented set of challenges” but stressed that Equity Commonwealth was “well positioned to weather this storm and to thrive.”

However, he did not get into specifics about what moves Equity Commonwealth planned to make given the drastically different and rapidly changing economic landscape. He said the company’s general view is that the fallout from the pandemic is still in its early stages and that it could be months or quarters before good opportunities become available.

Equity Commonwealth’s net income for the quarter was about $426 million, while total revenue was about $18.8 million.

Zell, who was not on the earnings call, purchased Equity Commonwealth in 2014, and the company has raised about $3.4 billion by selling about 150 office properties over the past few years. He has made his money by purchasing distressed real estate amid economic uncertainty, so the current environment could prove to be another opportune one for him.


Related Articles

arrow_forward_ios
Foot traffic in Union Square, the Flatiron District and Chelsea is down by 50% from February. (Getty)

Foot traffic remains low in prime Manhattan neighborhoods

Foot traffic remains low in prime Manhattan neighborhoods
About 25 percent of employees had returned to work as of Nov. 18 (Getty; iStock)

Offices remain empty, and big cities are feeling the crunch

Offices remain empty, and big cities are feeling the crunch
Singapore (iStock)

Singapore luxury market rebounds despite fewer foreign buyers

Singapore luxury market rebounds despite fewer foreign buyers
The tax break allows foreign visitors to reclaim a sales tax of 20 percent on items bought in the country for more than £30 (Getty; Unsplash)

UK tax break expiration could hurt struggling retailers

UK tax break expiration could hurt struggling retailers
Cineworld Group CEO Mooky Greidinger and Regal Cinema (Photo via Getty; Wikipedia)

Regal Cinemas scores financial rescue package

Regal Cinemas scores financial rescue package
(iStock)

What doom-and-gloom forecasts miss about the office market

What doom-and-gloom forecasts miss about the office market
Union Square Hospitality Group CEO Danny Meyer and the Union Square Cafe (Photos via Getty; Wikipedia Commons)

Danny Meyer’s Union Square Hospitality halts indoor, outdoor dining

Danny Meyer’s Union Square Hospitality halts indoor, outdoor dining
A recent study that found 1 in 10 Black homeowners returned to renting between 1984 and 2017 (iStock)

Black homeowners twice as likely to lose homes and return to renting: Report

Black homeowners twice as likely to lose homes and return to renting: Report
arrow_forward_ios

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

Loading...