Get all the latest news on coronavirus and more delivered daily to your inbox. Sign up here.
Continue Reading Below
In New York, which is one of the hardest-hit places by the virus, property owners are juggling rent defaults with a thin sales market.
A report in the Wall Street Journal highlighted Empire State Realty Trust, which owns the Empire State Building and 13 other commercial properties in the New York region. In its first-quarter earnings presentation last week, the company said it collected only 73 percent of its April office rents and 46 percent of its retail rents. So far those figures are the lowest-reported for the first quarter in any real-estate investment trust's results.
Another real-estate giant, SL Green Realty, New York's largest office-building landlord, is regaining its footing after a $815 million deal to sell the former New York Daily News headquarters collapsed in March, according to the Journal.
SL Green on Monday, however, did close the sale of a $30 million loan backed by a Brooklyn apartment building to Kushner Cos., which is owned by the family of senior White House aide Jared Kushner. And while the firm said it collected more than 90 percent of its April office rents, it received less than 65 percent of rent checks from its retail tenants.
“There's obviously a lot of uncertainty surrounding rental payments over the next few months," Andrew Mathias, the firm’s president, said according to the report.
The company is now moving to make up for the defunct sale of the Daily News building by selling between $100 million and $150 million of loans in its debt portfolio. SL Green, whose shares have fallen 50 percent since Feb. 21, also plans to borrow money against the Daily News building, drawdown from its credit lines among other measures.
A handful of other large REITs are expected to report their first-quarter earnings soon. The Paramount Group is expected to report Wednesday, Boston Properties is expected to report this week and Vornado Realty Trust is scheduled to report the first week in May.
While the real-estate outlook is lackluster for big landlords, it hasn’t looked great for everyday renters, either. Almost a third of U.S. apartment tenants did not pay April rent during the first week of the month.