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REFA Webinar Recap

COVID-19: How it’s Impacting the CRE Industry
Challenges – Implications – Best Practices


Presented by: Robert Allaire, CFO/Principal, Allaire Risk, LLC;

Paul AyoubPartner, Nutter; Jon DavisCEO & Founder, The Davis Companies;

Wendy FiscusPartner, Nutter; Robert Palter, Senior Partner, McKinsey & Company,

Claudia Piper, Webster Bank, 2020 REFA President, Navjot SinghSenior Partner, McKinsey & Company, 
John WolffSVP/Real Estate Market Executive, Commercial Real Estate Banking, Bank of America


Top Takeaways from our Speakers:


Confusion about construction projects with City and State Regulations in conflict. 130 City of Boston construction projects stopped with $7 billion in value. 


Construction is struggling with supply chain issues. Chinese factories have largely been open for the last week or two. Some Canadian factories are now getting back up and running if they have contractual obligations that pre-date the crisis that they need to fulfill. 


Capital Availability coming into the crisis was very strong in the US banking system and has been available through the banks as businesses and consumers tap credit lines without issue.  That said, capital will become more precious as this downturn persists in length and bank earnings decline from recessionary factors.  


Debt funds will be severely impacted in the current environment due to higher exposure to impacted asset classes including hotels and retail and potential mark to market/covenant issues from funding sources; and loss of ongoing funding sources from banks and the CLO market.


CMBS has been impacted with new loan originations and issuance essentially shut down; will be on the sidelines until market certainty improves and bond buying resumes


Pricing of CRE Capital has widened considerably for both public and private debt and loan markets.  Price discovery in process although there are fewer transactions so spread and floor requirements vary considerably. New loan originations in general will likely require significant spread increase of 100bps +/- with floors of 75bps+/-.


Regulatory Assistance: Interagency guidance from federal regulators this week encourages financial institutions to defer payments on loans impacted by COVID0-19 for up to 180 days.  This guidance allows banks to work with borrowers who will have troubles meeting their requirements due to COVID-19, especially on hotel and retail loans, without these loans being accounted for as Troubled Debt Restructures (or impaired).  Loans must be current prior to the crisis to be eligible for this type of modification and payment relief


Pandemics typically do not fall into Business Interruption Insurance.  Landlords may also try to make claims under other sections of their insurance policies. 


Force Majeure: There is only a small amount of case law on the subject of Force Majeure over the past 100 years and cases do not relate to pandemics.  For any claim, the language must be closely reviewed to determine applicability.  A governmental shutdown of construction sites would likely qualify as an unanticipated event beyond the reasonable control of a party.  Even if a contract does not have express Force Majeure language, the common law doctrines of frustration of purpose and impracticability may apply.  Keep in mind that even if Force Majeure does apply, that may only permit a delay in performance and not an excuse to performance. 


Use of technology is at an all-time high, this event will drive further adoption.  Challenges come with technology including privacy issues, less social interactions. Relationships will still prevail. 


Anticipating a Q4 Recovery for CRE. 

REFA COVID-19 Webinar Recap


Information is rapidly changing.  GBREB will update this post as new information becomes available. There's a lot of information about government's response to COVID-19, however we have narrowed the focus of this page to issues impacting the real estate industry to serve as a resource for our members. 

Additional information, including legal advisories are available to members here .

Short-term residential rentals, Department of Public Health, 3/31/20
Mortgage Loan Borrowing , Division of Banks, 3/25/20
Constuction Letter With Guidance  3/25/20
COVID-19 ESSENTIAL SERVICES  Order of  the Governor Assuring Continued Operation Of Essential Services  
Essential Services FAQ
SMOKE ORDER Smoke Alarm and Carbon Monoxide Inspections for One and Two-Family Dwellings and Three to Five-family Apartment Buildings
Standing Order Housing Court
DHCD Resources For Renters and Homeowners

Guidelines For Open House and Apartment Showing Policy
Construction Notice 3/25/20
Construction Permitting 3/16/20


Building Owners and Managers, BOMA Boston, BOMA International
Multifamily Apartments, Massachusetts Apartment Association, National Apartment Association   
REALTORS, Greater Boston Association of REALTORS, Massachusetts Association of REALTORS, National Association of REALTORS
Commercial Brokers Association
Real Estate Finance Association


COVID-19 Update from REFA

We are thinking of all of those impacted by COVID-19. As we navigate through these challenging times, we would like to help be a resource for our members and the community.

We ask that you follow guidelines that are recommended by the local and federal government. Resources can be found here: MassGovCDCWHO.

What Can We Do?

To assist those less fortunate, we hope you will consider supporting our Charitable Partners, Rosie's Place, HomeStart, and FamilyAid or your local food bank.

Helpful Tips to Stay Healthy:

- Wash your hands

- Keep your hands away from your face

- Cover your mouth/nose with a tissue when you cough or sneeze

- Practice Social Distancing

- Work from home

Doing Our Part

As a reminder, REFA in-person meeting and events will be postponed until further notice.

The REFA Team and GBREB Staff have the option to work from home until approximately March 27th and we will update members with any information as needed. The best way to contact us is via email, but we will be checking our voicemails with limited access.

Our top priority is our members staying safe. REFA will do our part in keeping you informed with any updates we receive via email communications and twitter.

*If you have registered for an upcoming event prior to April 17th, you should have heard from the REFA staff about next steps. We will continue to update members with information about future events.

Stay safe and healthy!



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REFA Golf Tournament
Jul 27, 2020
Dedham Country & Polo Club
124 Country Club Road
Dedham, MA

Corporate Sponsors


REFA Golf Tournament
Dedham Country & Polo Club