Commercial Landlords Say They’ll be Bankrupted by Bills to Help Tenants

Daily Journal (May 28, 2020) Commercial landlords say temporary emergency bills intended to help struggling tenants during the pandemic will cause permanent damage by encouraging tenants to break leases, shifting financial losses to landlords. The bill receiving the most criticism from landlords is SB 939, advanced last Friday by a 5-1 of a Senate Judiciary Committee. If passed, it would among other things enact a moratorium on commercial eviction – for small businesses and non-profits – during the Covid-19 state of emergency, and would also allow tenants in the hospitality sector to renegotiate or walk away from commercial leases. Anton N. Natsis, chair of Allen Matkins’ global real estate group, said the language in the bill is too broad. Section 1951.9 of the bill states that if a tenant does not pay rent during any or all months during the state of emergency, the sum total of that rent shall be due 12 months after the state of the emergency ends. “There’s a difference between opening up the entire world, stage by stage, and pronouncing this no longer a state of emergency,” Natsis said in an interview on Wednesday. “Everything could be fine, and we can have a vaccine, but we can be in a state of emergency all the way through next year.” Read More (subscription required)