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Articles Tagged with commercial real estate leasing

JCatalanoSRHL2ORivera2014By Oscar R. Rivera and John Catalano

Real estate billionaire Tom Barrack, the chairman and chief executive officer of Colony Capital, warned recently that the U.S. commercial real estate mortgage market is on the brink of collapse due to a predicted chain reaction of margin calls, mass foreclosures, evictions and bank failures resulting from the coronavirus pandemic.

“Loan repayment demands are likely to escalate on a systemic level, triggering a domino effect of borrower defaults that will swiftly and severely impact the broad range of stakeholders in the entire real estate market, including property and home owners, landlords, developers, hotel operators and their respective tenants and employees,” he wrote.

The longtime friend of President Donald Trump surmises that the impact could dwarf that of the Great Depression.

Indeed, the commercial property market is under severe strain domestically and abroad due to forced shutdowns of retail and hospitality businesses during the COVID-19 outbreak.  The looming crisis in commercial real estate could eventually cause the Federal Reserve to relax some regulations, allow more forbearance on loans, and buy distressed assets directly by restarting the Troubled Asset Relief Program.

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The recent news from KLX Aerospace Solutions, the world’s leading distributor and service provider of aerospace fasteners and consumables, of its build-to-suit lease for its new global headquarters and distribution hub totaling more than 500,000 square-feet in Medley drew a great deal of attention in the aviation and real estate industries.

The lease represents the relocation and expansion of the company’s local facilities, and it helps to solidify South Florida’s stature as one of the world’s fastest-growing logistics, trade and air transport hubs.

klx1The company will add 100 jobs to its existing 600 as it expands from its existing Doral headquarters (see photo) to the newly built facility.  The building will be located at the intersection of NW 107 Street and 97 Avenue between Florida’s Turnpike and I-75 in Countyline Corporate Park.  It will include two floors of office space with the ability to expand as well as a state-of-the-art storage and distribution area.  KLX is one of many major players in the aviation industry with a presence in the Miami and Doral area, including Lockheed Martin and World Fuel Services.

Our firm’s other real estate attorneys and I congratulate KLX and all of the professionals who played a role in making this major aviation sector real estate deal come to fruition.  Click here to read the company’s press release on the new lease.

I am proud to be participating in the International Council of Shopping Centers (ICSC) RECon event, which will be taking place at the Las Vegas Convention Center & Westgate Hotel May 22-25, 2016.  This four-day educational program is the largest retail real estate exhibition and conference in the world, with more than 36,000 industry executives, retailers, financial companies, and product and service suppliers in attendance each year.

On Tuesday, May 24, I will be presenting the session titled “The Economics of a Lease: Developers and Retailers Perspectives,” which will cover the strategies and tactics of negotiating monetary provisions, including minimum and percentage rent clauses, security deposits, operating costs, real estate taxes and T/I payments.  icsclogo2015Participants will be led through an analysis of key elements of each of the lease provisions.  The session is scheduled to take place from 9 to 10:30 a.m.  Click here for additional program details.

Founded in 1957, ICSC is the global trade association of the shopping center industry with more than 60,000 members in the U.S., Canada and over 90 other countries.

 

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