Well, the SBA sure overpromised and underdelivered on the EIDL (Economic Injury Disaster Loan) program. Last week, they promised each applicant a $10,000 advance that would be paid in 3 days. It’s been well over a week and not only has no one received their funds, but after seeing so many applications, they’ve decided that they will only pay people $1,000 per employee, up to a maximum of $10,000. So hopefully that money is coming soon, but I’m not holding my breath.
The other SBA program, the PPP (Paycheck Protection Program) started accepting applications last Friday, and banks were immediately inundated with applications. Within two days, Bank of America has already received applications totalling over $32 billion – that’s almost 10% of the entire $349 billion allocated for this program! If you have not already applied for the PPP program, do it before the funds are depleted.
But if the funds run out, don’t worry. Treasury Secretary Steven Mnuchin says he’ll just go and get more money for the program.
Onto what’s happening in retail commercial real estate:
Ironically, the businesses that we were all talking about that would save retail (the “experiential retail” businesses in the food, fitness and fun sectors) are the ones who are suffering the most in this pandemic.
Most national retailer tenants are asking for rent concessions, even if they don’t need it. Landlords should ask tenants what they are doing for themselves before the tenants come to their landlords asking for a handout.
Many tenants are getting creative with their business models and expanding to offer other services. They need to be creative in this time in order to survive.
Contact me for any commercial real estate needs – I focus on the sale of retail properties in Southern California.