Author: Trey Jackson

Real Estate Roundtable Statement on Biden Like-Kind Exchange Proposal

Posted on by Trey Jackson

Presumptive Democratic nominee Joe Biden on July 21, 2020 released a policy proposal to fund universal childcare and in-home elder care by taxing real estate investors and targeting the taxation of like-kind exchanges.  Real Estate Roundtable President and CEO Jeffrey DeBoer responded by noting the many ways in which like-kind exchanges contribute to economic growth and create greater opportunity for entrepreneurs from under-represented demographic groups.

  • “The long-standing like-kind exchange tax law has encouraged investment in affordable housing and other properties, generated state and local tax revenue, and spurred new jobs through labor-intensive property improvement.  Exchanges reduce the need for outside financing, leading to less leverage and debt on U.S. real estate. As a result, exchanges allow cash-strapped minority, women, and veteran-owned businesses to grow their business by temporarily deferring tax on the reinvested proceeds,” DeBoer said.
  • He added, “Like-kind exchanges are particularly important during economic downturns when access to capital is less certain. In short, like-kind exchanges create a more dynamic real estate marketplace, ensuring properties do not languish, permanently underutilized and under-invested. Congressional review of like-kind exchanges is reasonable and appropriate, and we will support sensible reforms, as The Roundtable has in the past, that preserve and maintain the provision’s broad-based economic benefits.” 

A 2015 economic study commissioned by The Real Estate Roundtable and other national real estate organizations on the US commercial real estate market highlights the critical role that 1031 exchanges play in stabilizing rents, safeguarding  property values and strengthening the economy.   (“The Economic Impact of Repealing or Limiting Section 1031 Like-Kind Exchanges in Real Estate” by Professors David C. Ling and Milena Petrova)

Coalition Urges Congress to Help Businesses with COVID-Related Cleaning, Safety, and Prevention Expenses

Posted on by Trey Jackson

A broad business coalition urged Congress on July 16 to include assistance in the next pandemic response package to help businesses offset extra expenses related to heightened cleanliness and safety of work environments in the COVID-19 era. (Coalition letter, July 16)

  • The Worldwide Cleaning Industry Association (ISSA) is leading the coalition, which includes The Real Estate Roundtable, Building Owners and Managers Association (BOMA) International, the American Hotel & Lodging Association, International Council of Shopping Centers, and over two dozen additional national trade groups.
  • ISSA estimates that cleaning costs are 50% or higher compared to pre-pandemic practices due to increased use of disinfecting products, equipment upgrades, and greater frequency of cleaning activities. ISSA estimates a 3,000 square retail space will cost an additional $56,160 in cleaning-related costs – on top of personal protective equipment (PPE), testing, employee training, and other COVID-19-related expenses.
  • Several bipartisan bills pending in the House and Senate would establish a tax credit to help businesses and nonprofits cover more expensive safety and cleaning practices. Hill legislators are considering whether such incentives should be included in the next phase of pandemic relief legislation that may pass Congress before the August recess. 

Various “re-opening tax credit” bills introduced to date differ in terms of the size of the incentive they would offer, and the kinds of safety-related expenses they would cover. (The Hill, July 16) These bills include:

  • The Clean Start: Back to Work Tax Credit Act (H.R. 7079) introduced by Reps. Darin LaHood (R-IL) and Stephanie Murphy (D-FL), which would provide a 50% tax credit for the costs of qualified cleaning expenses including third-party janitorial services, cleaning products, PPE, and related tools and machinery. The bill proposes a credit maximum of $250,000 per business entity, up to $25,000 per location.
  • The Healthy Workplaces Tax Credit Act introduced by Rep. Tom Rice (R-SC), would offer a refundable tax credit for 50% of business’s costs incurred for COVID-19 testing, PPE, cleaning and disinfecting, and reconfiguring work spaces to adhere to social distancing guidelines. The credit would be limited to $1,000 per employee for a business’s first 500 employees; $750 per employee for the next 500 employees; and $500 per employee for each subsequent employee. 
  • Similar measures include a small business “workplace safety” tax credit (S. 4178) introduced by Sens. Kyrsten Sinema (D-AZ) and Kevin Cramer (R-ND); the “Safe Re-Opening Tax Credit” (H.R. 7222) introduced by Rep. Jimmy Panetta (D-CA); and the “Small Business PPE Tax Credit Act” (H.R. 7216) introduced by Rep. Brenda Lawrence (D-MI).

The ISSA-spearheaded coalition explained in its letter that any “re-opening tax credit” should be targeted, temporary, capped, and available to business entities and non-profits regardless of size. The letter noted that such a tax credit would help protect against further COVID-19 infections and other respiratory conditions such as asthma, MRSA and influenza. 

A COVID-induced healthy workplace tax credit would be “critical to the safety of Americans as businesses re-open and workers return to their jobs. The proposal will also prepare workplaces to better deal with future emerging pathogens that we could be confronted with in the future,” the coalition letter concludes.  

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Policymakers Signal Positions on Next COVID-19 Relief Package; Negotiations Expected to Address Business Liability and Aid to Business Sectors

Posted on by Trey Jackson

Lawmakers return to Washington on July 20 to begin urgent negotiations on a massive COVID-19 relief package that is expected to address business liability, unemployment benefits and tax incentives before Congress breaks for its August recess. (BGov, July 17 and CQ, July 15)

  • Treasury Secretary Steven Mnuchin today testified before the House Committee on Small Business, urging Congress to swiftly pass a fourth significant relief package since the pandemic outbreak.  
  • Mnuchin said additional relief should target certain industries, smaller businesses, and lower- to middle-income families that have been especially hard-hit by the pandemic. “Certain industries, such as construction, are recovering quickly, while others, such as retail and travel, are facing longer-term impacts and will require additional relief,” Mnuchin said in his prepared remarks.

Mnuchin added that the Paycheck Protection Program (PPP), which provides forgivable small business loans, should be extended, but on a more targeted basis for smaller companies and hospitality businesses.  (NYTimes, July 17)

Senate Proposal on Business Liability

Senate Republicans are expected to unveil their economic aid proposal early next week that is expected to include some level of unemployment subsidy and address business liability.  (The Hill, July 17)

  • Senate Majority Leader Mitch McConnell (R-KY) has emphasized that federal courts should have jurisdiction over liability claims arising from coronavirus infections to limit the legal exposure of businesses, schools and other organizations as they reopen.  (Washington Post, July 6)
  • McConnell and Texas Republican Senator John Cornyn are working on a measure that would temporarily give businesses, schools, colleges, charities and other organizations a shield from lawsuits as long as they make “reasonable” efforts to follow public health guidelines and didn’t commit an act of “gross negligence” or “intentional misconduct.” (BGov, July 16 and Wall Street Journal, July 16)
  • A draft outline of the Senate’s new COVID-19-related liability protections for businesses proposes a five-year shield from coronavirus lawsuits. The proposal would be retroactive from December 2019 through 2024, or until the expiration of an emergency declaration issued by the Department of Health and Human Services. (The Hill, Fox Business and CBS News, July 17)
  • The newly released Senate summary reflects principals supported by The Roundtable that were part of a multi-sector coalition letter sent to Hill leadership on May 27.  (Roundtable Weekly, May 29)
  • Roundtable President and CEO Jeffrey DeBoer talked about the business liability issue and how it affects CRE in a July 10 CBRE podcast – “Public Policy in the Age of COVID: Shaping the CRE Recovery.” 
  • DeBoer noted during the podcast, “… if businesses don’t have a roadmap on what they’re supposed to be doing to keep people healthy when they come in contact with their business – and I’m talking about schools and hospitals and bowling alleys and shopping centers.  We need to understand what it is that we’re supposed to be doing as a reasonable person in order to not subject ourselves to potential liability claims down the road.”

He added, “We don’t want a blanket shield. We’re not talking about protecting people from negligent activities and certainly not people that are grossly negligent. But we want to understand what we should be doing so that we can … protect the people that work in our buildings and come into our buildings every day. And without that protection, it’s going to be very hard for businesses and people in hospitals and schools and everyone to move forward. So this is critically important.”

Upcoming Negotiations

Senate Finance Committee spokesperson Michael Zona commented yesterday about upcoming negotiations on Phase Four of COVID-19 relief, “A number of tax relief proposals will be part of the discussion.” (Bloomberg Tax and Politico, July 16)

  • Several bipartisan bills currently in the Senate and House would create a healthy workplace tax credit for businesses and nonprofits that incur unexpected costs as they reopen, including extensive cleansing, COVID-19 testing and personal protective equipment for employees.  (See more details in the “Healthy Buildings” story, below)
  • The House of Representatives in May passed the $3.4 trillion HEROES Act, the largest financial stimulus bill in U.S. history, to combat the ongoing economic fallout related to the coronavirus pandemic. (H.R. 6800, Health and Economic Recovery Omnibus Emergency Solutions Act: one-pager; section-by-section; state and local relief summary and Roundtable Weekly, May 22) 
  • Republican policymakers have signaled they are open to another COVID-19 bill, but on a measured basis, and the Trump administration has called for limiting the next relief package to $1 trillion.
  • President Trump this week also said he will not sign a new coronavirus stimulus package without the inclusion of a payroll tax cut, which has not attracted much support on Capitol Hill.  (Washington Post, July 16)
  • The time frame for legislative action on legislation that will likely exceed a trillion dollars is tight.  The House is aiming to recess for the summer on July 30, while the Senate plans to recess on August 7.
  • The Democratic Party Convention is scheduled for August 17-20 in Milwaukee, WI. Republicans are planning to hold their convention August 24-27 in Jacksonville, FL.

Both chambers plan to return from summer recess on September 8.

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RER – COVID-19 Economic Crisis Alerts

Posted on by Trey Jackson

July 30, 2020 – The Real Estate Roundtable COVID-19 Economic Crisis Alert – Walker Webcast – All Eyes On Washington: What will the next stimulus bill do for CRE?

July 24, 2020 – The Real Estate Roundtable COVID-19 Economic Crisis Alert – Interview with Rep. Darin LaHood (R-IL)

July 10, 2020 – The Real Estate Roundtable COVID-19 Economic Crisis Alert – Public Policy in the Age of COVID: Shaping the CRE Recovery 

May 14, 2020 – The Real Estate Roundtable COVID-19 Economic Crisis Alert – National Economic Policy Responses to the COVID-19 Crisis

May 6, 2020 – The Real Estate Roundtable COVID-19 Economic Crisis Alert – Interview with Dr. Joseph Gardner Allen, Assistant Professor with the Harvard T.H. Chan School of Public Health

May 5, 2020 – The Real Estate Roundtable COVID-19 Economic Crisis Alert – “The Policy Response to COVID-19: Implications for Real Estate” – hosted by the Pension Real Estate Association (PREA)

May 1, 2020 – The Real Estate Roundtable COVID-19 Economic Crisis Alert – Unpacking the Federal Stimulus – Bisnow Webinar

April 21, 2020 – The Real Estate Roundtable COVID-19 Economic Crisis Alert

April 10, 2020 – The Real Estate Roundtable COVID-19 Economic Crisis Alert 

April 3, 2020 – The Real Estate Roundtable’s COVID-19 Economic Crisis Alert 


New Data Shows Greater Flood Risk Across America, National Flood Insurance Program Funding Scheduled to Expire September 30

Posted on by Trey Jackson

Flood Data map First Foundation

Properties across much of the United States face a far greater risk of flood damage then current estimates maintained by the Federal Emergency Management Agency (FEMA), according to new data from the First Street Foundation, a non-profit research and technology consortium.  (New York Times, June 29)

  • FEMA administers the National Flood Insurance Program (NFIP), which aims to reduce the impact of flooding on private and public structures by providing affordable federal insurance to property owners, renters and businesses and by encouraging communities to adopt and enforce floodplain management regulations.
  • Funding for NFIP is currently scheduled to expire on September 30, after numerous temporary extensions.  The federal government’s current flood maps guide homebuilders, owners and mortgage lenders about flood risk.
  • The First Street Foundation’s report, “The First National Flood Risk Assessment: Defining America’s Growing Risk” classifies 14.6 million properties as being at substantial risk from flooding, whereas FEMA classifies 8.7 million properties as facing the same risk.  (Axios, June 29)
  • In current climate conditions, 21.8 million properties are classified as at risk, according to the new report.  “When adjusting for future environmental changes, by 2050, this will raise the number of properties with any risk across the country by 7.7% percent to 23.5 million,” the report states.
  • Any home can be searched on First Street’s FloodFactor.com website, which will soon integrate its data with Realtor.com.

Matthew Eby, founder and executive director of First Street Foundation said, “There are millions of Americans who have substantial flood risk and have no idea and now they’ll be able to access that … Having that data available will change the perspective of flood risk in this country.”

The National Flood Insurance Program (NFIP)

On May 14, 2019, the House Financial Services Committee unanimously approved a five-year flood insurance reform and reauthorization bill – the National Flood Insurance Program Extension Act of 2019 (H.R. 2578).

  • The bill would renew the NFIP until Sept. 30, 2024; forgive the NFIP’s remaining $20 billion debt and boost funding for mapping, floodplain management, and mitigation for homes, businesses and infrastructure.  It has not yet made it to the floor for a vote due to pressure from coastal state interests.
  • Meanwhile, the Trump Administration plans to overhaul government-subsidized flood insurance, in a sweeping proposal that could raise rates on more expensive properties and those in higher-risk areas. The proposal would take effect on Oct. 1, 2020. (Wall Street Journal, March 23, 2019)
  • Under the current NFIP, commercial property flood insurance limits are very low – $500,000 per building and $500,000 for its contents.  Lenders typically require this base NFIP coverage, and commercial owners must purchase Supplemental Excess Flood Insurance for coverage above the NFIP limits. 
  • Only a niche market of carriers typically provides this type of excess coverage and The NFIP’s low commercial limits make it problematic for most commercial owners.
  • The Roundtable and its coalition partners support NFIP reauthorization with the inclusion of provisions that permit a voluntary “commercial exemption” for mandatory NFIP coverage if commercial property owners currently maintain adequate flood coverage.

Congress will face the possibility of yet another NFIP funding extension before September 30 if policymakers cannot agree on reforming the program through legislation.

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House Democrats Pass $1.5 Trillion Climate-Focused Infrastructure Package While GOP Prioritizes Surface Transportation Funding

Posted on by Trey Jackson

Transportation Infrastructure Seattle

House Democrats on July 1 passed a sprawling $1.5 trillion infrastructure package (the Moving Forward Act, H.R. 2) largely along party lines (233-188). The bill would reauthorize spending for the nation’s roads, bridges and mass transit transportation – and also addresses housing, water, broadband, renewable energy, electric grid, and education infrastructure.  (Wall Street Journal and Washington Post, July 1) 

  • The broad Democratic package reflects the party’s blueprint for infrastructure priorities in the lead-up to the November elections. (Politico, July 1) H.R. 2 includes climate-related provisions that would require states to measure and reduce emissions from transportation systems, which account for the nation’s single largest source of greenhouse gases. (U.S. Energy Information Administration) 
  • H.R. 2 would also support mass transit and other low-emissions transportation modes with more money, and spur greater electrification of vehicle fleets.
  • H.R.. 2 faces steep GOP opposition. (E&E News, June 29) Senate Majority Leader Mitch McConnell (R-KY) said the measure is “not going anywhere in the Senate” due to its price tag and focus away from highways and more traditional surface transportation funding. (The Hill, July 1)
  • The White House threatened to veto H.R. 2 because it includes “‘Green New Deal’ initiatives” and “fails to tackle the issue of unnecessary permitting delays, which are one of the most significant impediments to improving our infrastructure.”  (Statement of Administrative Policy, June 29) The Trump administration is reportedly preparing its own $1 trillion infrastructure proposal. (Reuters, June 15)
  • A core component of the House-passed legislation is a $494 billion surface transportation bill – the INVEST in America Act – that would reauthorize funding for the Highway Trust Fund, which is scheduled to expire on September 30. Action on the Highway Trust Fund has been considered a “must-do” policy item before the November elections (Roundtable Weekly, June 19 and June 26)
  • A National League of Cities survey shows that coronavirus-related expenses have forced more than 700 U.S. cities to suspend or terminate plans to upgrade critical infrastructure. (Washington Post, June 23)

Job-creating infrastructure legislation could become a major focus for lawmakers in the second half of 2020 as high unemployment levels linger amid increasing uncertainty about business reopenings during the pandemic.

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Real Estate Roundtable Re-Elects Cafaro as Chair, Approves Five New Board Members; 2020 Annual Report Focuses on National Recovery

Posted on by Trey Jackson

Real Estate Roundtable FY 2021 Board of Directors - image

The Real Estate Roundtable’s membership has re-elected Debra A. Cafaro (Chairman and Chief Executive Officer, Ventas, Inc.) as Chair, while approving five new members for its Board of Directors who will serve during the organization’s 2021 fiscal year (July 1, 2020 – June 30, 2021).

  • Roundtable President and CEO Jeffrey DeBoer presented the election results and the organization’s FY2020 Annual Report, Leading Though Crisis, during The Roundtable’s June 11 Annual Meeting. 
  • The 24-member FY2021 Board is elected from the membership and includes five elected leaders of national real estate trade organizations from The Roundtable’s 19 partner associations.  
  • Cafaro, whose three-year term as chair began July 1, 2018, said, “We are delighted to welcome five industry leaders to The Real Estate Roundtable Board.  Their outstanding backgrounds, broad industry representation and diverse experiences will enhance our ability to act as the cohesive industry voice addressing key national policy issues relating to real estate and the overall economy. With our existing Board members, we also intend to drive constructive solutions to economic challenges created by the COVID-19 and racial injustice, both of which are crucial to our society, the national economy, local communities and our industry.
  • I also sincerely thank our Board members whose terms have expired.  They have made significant contributions to the industry and we look forward to their continued engagement with The Roundtable,” Cafaro said. 
  • DeBoer stated, “Roundtable members are among the most talented and innovative industry leaders.   Our Board of Directors represents all major industry activities and is diverse geographically, racially and by gender.  The Board’s strategic and organizational decisions are thus sustainable, practical and inclusive.  I look forward to continuing to follow the Board’s recommendations as we continue our fact-based analysis of overall economic and industry specific policy issues.” 
  • Joining The Roundtable’s Board of Directors as of July 1 are:

National Recovery & Leading Through Crisis

Jeffrey DeBoer addresses how policymakers and the industry can move forward in the wake of the COVID-19 Pandemic in a July 10 CBRE podcast with Brian Stoffers, Chairman of the Mortgage Bankers Association and Global President of Debt & Structured Finance, CBRE.

  • DeBoer states in Public Policy in the Age of COVID: Shaping the CRE Recovery, “…look at what Washington has tried to do … building a bridge, in a sense, a bridge to get people and businesses to a point where they return to some semblance of normalcy. And the problem … is the bridge going to get us there as it’s currently constructed? Is it long enough? Is it strong enough?”

  • He adds, “…there’s a great deal of concern about that because the PPP – the Paycheck Protection Program – that helped people pay their rent and the unemployment and the supplemental … will it burn off at the same time that the economy regenerates itself? Or will there be this lapse? And if there is a lapse, that’s really the focus, I think, of a great deal of concern right now.”

The Roundtable has also released its FY2020 Annual Report – Leading Though Crisis.

  • Chair Cafaro states in the report that as The Real Estate Roundtable beings its 21st year of industry policy work, the nation’s economy is in deep distress due to the COVID-19 health crisis and Americans’ civil protest is a justified expression of anger and frustration around racial injustice. 

  • “We pledge to take action and be part of the solution,” Cafaro states.  She adds that there is much to be done on the policy front ahead: “Although the challenges in these times are unprecedented, our response is based on the same longstanding commitment to sound, evidence-based, nonpartisan policy that undergirds all of our work and success. We know from experience that there is a path to recovery.”

The Roundtable’s Meeting Calendar for FY2021 is now available.  The next Fall Roundtable Meeting on September 22 is for Roundtable-level members only.  Registration forms for the remote meeting will be sent directly to members. 

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Key Policymakers Testify on COVID-19 Relief and CRE; Congress Extends PPP until August 8; House Passes Bill Extending Eviction Moratorium 12 Months

Posted on by Trey Jackson

House Financial Services Committee hearing with masks and social distancing

Federal Reserve Chairman Jerome Powell and Treasury Secretary Steven Mnuchin offered their views on potential COVID-19 relief for commercial real estate during a June 30 House Financial Services Committee that focused on the federal government’s response to the pandemic. (HFS Committee hearing, June 30)

  • Barr added that without federal intervention, the commercial real estate sector could experience a wave of foreclosures and defaults.  He asked if the Federal Reserve has the authority to establish a credit lending facility to service commercial real estate. 
  • Powell responded, “I’ve been very focused on this. You’ve got people who can’t currently service debt, you’ve got these inflexible arrangements. So there’s a serious problem here that needs to get fixed and we’re racking our brains to see how – how it could be something we could do by lending, but that’s really all what we can do … is create more debt.”
  • Mnuchin acknowledged the June 22 letter and responded that CRE sectors such as hotels may be considered for direct aid in the next round of coronavirus relief. 
  • Mnuchin stated, “This is a large challenge. So, we have been working with the Fed, we have not yet figured out a way to set up a facility. So, it’s not out of a lack of interest or a lack of it desire. There are structural problems. And let me just add, in many of these cases, these companies don’t need more debt. They need support. So, one of the things we will want to look at in the next CARES Act, as I said, is additional support for these hardest hit industries. As the (Fed) Chair has said, there’s a difference between lending and spending.”

  • Rep. Bill Posey (R-FL) warned that hoteliers’ inability to make payments threatens the servicing of CMBS. Munchin responded that the CMBS industry has restrictive covenants limiting their ability to utilize relief programs. “And that’s why one of the things I do think we need to look at in the next CARES Act is additional funding for these industries that are the hardest hit so they can continue to rehire people so that, as occupancy increases, that they have employees that they can maintain. We need to look at additional support for these hard hit industries,” Munchin said. 

Mnuchin also discussed the Administration’s work with Congress to address the economic fallout from the outbreak with The Roundtable’s President and CEO Jeffrey DeBoer during the organization’s Virtual Annual Meeting last month. Secretary Mnuchin emphasized how recent improvements to the Paycheck Protection Program (PPP) has helped small business borrowers deal with the economic impact of the global pandemic.  He added that the Administration is also considering business liability protections and pandemic risk insurance.  (Watch the discussion on The Roundtable’s Youtube channel here.)

Extending and Repurposing PPP

The House and Senate this week passed an extension to the Paycheck Protection Program (PPP), allowing small businesses to apply for these loans until August 8. President Trump is expected to sign the extension into law. (CQ, July 1)  

  • Mnuchin’s testimony on June 30 came on the same the day that the (PPP) was set to expire, with approximately $130 billion of the original $670 billion allocated unused.  The PPP was created by Congress in March to enable small businesses to apply for forgivable loans during the pandemic.
  • Mnuchin stated that as of June 27, the PPP had approved 4.8 million small businesses loans totaling $520 billion, supporting an estimated 50 million jobs. (ThinkAdvisor, June 30)

Mnuchin also told the House Financial Services Committee (HFSC) that he supports congressional legislation to repurpose the remaining PPP funds.  “There appears to be bipartisan support in the Senate to repurpose the (funds) for PPP, extending it to businesses that are most hard hit, that had a requirement that their revenues have dropped significantly, things like restaurants and hotels and others where it is critical they get people back to work.”

House Passes Eviction Moratorium Extension

HFSC Chairwoman Maxine Waters (D-CA) led the effort for House passage this week of the Emergency Housing Protections and Relief Act of 2020 (H.R. 7301), which supplements housing assistance provisions passed in May as part of the HEROES Act.  (Rep. Waters House floor statement, June 30 and Roundtable Weekly, May 15.)

  • The National Multifamily Housing Council (NMHC) and National Apartment Association (NAA) sent a June 29 letter to Congressional leadership expressing concerns about the bill’s expansion of the federal eviction moratorium that would undermine the benefits of other provisions within the legislation.  
  • The bill also would also provide multifamily building owners who are economically impacted by the pandemic the ability to obtain forbearance on making mortgage payments for a maximum of 360 days, whether those loans are federally-regulated or from a non-federal lender.  
  • The NMHC letter offers strong support for several measures within H.R. 7301, including liquidity for multifamily mortgages and servicers, additional funding for Section 8 Housing Choice Vouchers and support for rural housing.
  • However, the letter also notes that the bill substantially expands the federal eviction moratorium established in the CARES Act to virtually all single family and multifamily homes for 12 months.  The moratorium extension is also untethered to any actual COVID-19 impact on a renter and disconnected from a renters’ qualification or acceptance of emergency rental assistance.

The letter states, “A protracted eviction moratorium does not provide a sustainable, long-term solution for American families facing financial hardship and we oppose the inclusion of this provision for the severe consequences it will have that ultimately blunt the impact of the positive components of the legislation.”  (NMHC, June 29)

Next COVID-19 Relief Package

This week’s action on COVID-19 related policy comes as Democrats and Republicans consider an additional coronavirus relief package after they return from the congressional July 4 recess.

  • The House in May passed its own $3 trillion pandemic recovery package, which includes billions in aid for state and local governments.  Republicans have signaled they may be open to another COVID-19 bill, but on a measured basis. (Forbes, May 21 and Roundtable Weekly, May 22) 
  • Senate Majority Leader Mitch McConnell (R-KY) this week said the goal for finishing the next coronavirus package would be before Congress breaks for its lengthy August break.
  • McConnell assessed that when policymakers return on July 20, it “dovetails nicely with the perfect time to take an assessment of the economy and the progress we’re making on the health care front and see if there is additional assistance needed for our health care providers,” McConnell said. (Politico, June 30) 

Congress will have an 11-day window in late July to act on another stimulus package.  President Trump yesterday said he supports another round of direct stimulus payments as part of a potential phase four coronavirus relief package.  “We’re working on a ‘phase four.’ We’re working with Congress,” Trump said. “Work has started.”  (Axios, July 1 and Fox Business, July 2)

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House Democrats Propose Climate Framework With Measures to Reduce Buildings’ Carbon Footprint

Posted on by Trey Jackson

Solving The Climate Crisis - House Democrats' Proposal

The House Select Committee on the Climate Crisis on June 30 released its blueprint for “Solving the Climate Crisis.”  The plan proposes a menu of mandates and incentives for multiple industry sectors – including commercial and residential real estate – with a goal to achieve a 100% “net zero” emissions U.S. economy by 2050.  (Summary of the 547-page report)

  • The plan is widely viewed as a roadmap the Democrats may follow for developing climate policy legislation after the November elections.  The plan is currently not expected to see any action in the GOP-controlled Senate. (Axios, July 1)
  • A series of 1-page summaries describes specific recommendations to reduce GHG emissions for “Buildings” – and for the “Electricity,” “Financial Risk,” Transportation,” and “Manufacturing” sectors.
  • The “Buildings” summary covers both new construction and existing buildings.  It includes proposals to:
    • Set federal energy benchmarking requirements for commercial buildings (which a number of states and localities have already adopted); 
    • Eliminate emissions from new buildings by 2030 by incentivizing states and cities to adopt net-zero codes;
    • Use tax incentives to drive commercial building retrofits;
    • Boost onsite clean energy generation by increasing tax incentives and rebates;
    • Reduce emissions from building construction by incentivizing building reuse and requiring federal buildings to use lower-emission building materials;
    • Increase availability of energy efficient affordable housing; and
    • For federal buildings, enact heightened standards for deep energy retrofits and emissions intensity targets.
  • Select Committee Chair Kathy Castor (D-FL) stated, “Our plan will put people back to work and rebuild in a way that benefits all of us. That means environmental justice and our vulnerable communities are at the center of the solutions we propose.” (June 30 news release)
  • The Roundtable submitted a comment letter to the Select Committee during its public participation period (see Roundtable Weekly, November 22, 2019).
  • The Roundtable’s recently released 2020 Annual Report affirms a proactive “Energy and Climate” policy agenda developed by its Sustainability Policy Advisory Committee, chaired by Anthony E. Malkin (Chairman, President and CEO, Empire State Realty Trust) and vice-chaired by Dan Egan (Senior Vice President, Vornado Realty Trust). 

The Empire State Building’s successful sustainability efforts are the focus of a recent Washington Post  profile, which details the “deep retrofit”  led by Malkin and completed in 2010.  “A decade later, the Empire State Building saves more than $4 million a year on its electric bill; the project is expected to pay for itself twice over,” the Post reports.  (Empire State of Green, May 27, 2020)

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Roundtable to Establish Standing Policy Committee on Diversity and Inclusion; Industry Executives Discuss Needed Actions

Posted on by Trey Jackson

Roundtable Meeting

The Real Estate Roundtable’s Board of Directors recently approved establishment of a new standing committee to address inclusivity and diversity in the industry and as part of the organization’s policy agenda.  (Roundtable Weekly, June 12)

  • The new committee’s working name is the “Real Estate Diversity and Inclusion Policy Advisory Committee” (REDIPAC).  Its intended objectives are to: 
    • Encourage Roundtable members to adopt and report on quantifiable standards for attracting workers across all skill- and corporate-levels from minority and other pools of talent historically under-represented in our industry;
    • Leverage The Roundtable’s existing advocacy agenda on tax, capital, climate/energy, housing, and infrastructure policies with a view toward also including policy elements aimed to dismantle racial and other barriers to equality; and
    • Build coalitions with civil rights and real estate industry organizations to scale the effectiveness of joint initiatives.
  • The new committee’s mission statement, leadership and requests for participants are expected to be announced in July.
  • This week, African American real estate executives discussed actions needed to expand diversity at all levels of the industry during a webinar on “The Black Experience in Real Estate,” hosted by NYU’s Schack Institute of Real Estate. 
  • Schack Associate Dean Sam Chandan lead the remote discussion with four panelists:  
  • The panelists expressed their hope that recent executive-level responses to the deaths of George Floyd and other African Americans at the hands of police officers represent not simply a “moment but a movement.”  The webinar participants also agreed what is needed now are tangible actions that could bring measurable, positive changes to increase opportunities for minorities in real estate. (The Real Deal, June 26) and Bloomberg, June 23, “Black Real Estate Executives Seek Lasting Change in Diversity”)
  • The four leaders discussed their personal experiences with systemic racism and recommended inclusivity steps that CRE leaders should take in their companies.  (Registration required to watch the June 9 webinar) 

Separately, a June 24 Walker & Dunlop webinar focused on the first African American woman REIT CEO – Leslie Hale of RLJ Lodging Trust.  Roundtable Member Willy Walker, W&D’s Chairman & CEO, hosted the discussion, which addressed the opportunities for increasing diversity in commercial real estate, Ms. Hale’s approach to diversity and inclusion, the current outlook for the hospitality and retail industries, the U.S. economy and more. 

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