Editors’ Weekly News Roundup, September 25 – September 29
With concerns about looming commercial real estate debt maturities in the air, it stands to reason that lawmakers would sit up and take notice. And it makes sense that Connect CRE’s coverage of the bill introduced in the U.S. House of Representatives would be our most-read story for the week ending Sept. 30.
Bipartisan Legislation Would Support CRE Loan Workouts told readers that a bill introduced by Reps. Claudia Tenney (R-NY) and Brian Higgins (D-NY) sought to ease the tax burden on a borrower that can arise when a troubled commercial real estate loan is modified as part of a debt workout. The Real Estate Roundtable gave the proposed measure a thumbs-up.
In second place among our five most-read stories was one about a locally based retailer with plans to greatly expand its nationwide footprint. Fast-casual restaurant chain Portillo’s, based in the Chicago suburbs, currently operates 77 locations across 10 states, but the company intends to grow its store count by more than tenfold.
Along with revealing aspirations for expansion, Portillo’s Plans to Open 920 Locations Over 20 Years also detailed new thinking on design. “Moving forward, Portillo’s is designing full-scale restaurants with a smaller overall footprint and shorter production line,” the company said.
A developer whose vision was laser-focused on his hometown of Los Angeles, Wayne Ratkovich nonetheless enjoyed renown across the U.S. Therefore, it wasn’t surprising that a breaking news story about his passing would rank in the top five for the past week. In Wayne Ratkovich Passes Away at 82,Connect CRE readers were able to review the life, career and philanthropic interests of an industry giant.
Staying with the overall theme of development, our fourth story reported on an industry survey conducted by the National Multifamily Housing Council. As reported in NMHC: Rental Housing Developers Challenged by Delays, Lack of Financing Options, the survey results made it clear that these delays are widespread and are expected to continue.
Rounding out the top five was another story related to CRE financing. The Mortgage Bankers Association reported that outstanding debt from CRE and multifamily loans increased again in the second quarter.
However, in CRE Debt Increases by $38B in Q2, Says MBA, Jamie Woodwell, MBA’s head of commercial real estate research, made it clear that the quarterly increase wasn’t necessarily due to the volume of new loans. “Commercial and multifamily mortgage originations are down by more than half from a year ago, and this lack of new demand means that fewer loans are being paid off,” said Woodwell. “This in turn is helping to maintain, and in some cases even grow, the amount of credit outstanding.”
Our story on H.R. 5580, the legislation introduced by Tenney and Higgins was not the only headlining report on troubled CRE debt. As part of our expanded coverage of distressed real estate, we provided an in-depth look at the options available to borrowers faced with debt or properties that have been challenged by the current environment. There will be more deep-dive reporting where that came from.