The COVID-19 pandemic has hit the American economy in a number of ways, particularly in the commercial real estate leasing sector. In a front page article, titled “Missed rent payments drive wedge between Nashville commercial landlords, businesses,” the Tennessean examines the ways that the pandemic is impacting the relationship between commercial landlords and tenants.
This article focuses first on the once-thriving Nashville tourism market, citing the lease default and surrender of possession of an entire 101-unit apartment building by a short-term rental company, because “the novel coronavirus pandemic brought tourism and travel to a screeching halt.” The article goes on to discuss other high-profile commercial real estate lease transactions that fell through or soured as a result of the economic uncertainty, including the litigation arising from the lease dispute between the Nashville Hilton hotel and The Palm steakhouse.
The article cites Anthony Legal lawyer David Anthony for insight on the uncertainty many parties in commercial real estate sector are experiencing.
“The roller coaster I’ve seen is, early on, landlords being really aggressive, and then once they kind of got a lay of the land, they started really softening their demands,” Anthony said about many commercial landlord’s approach to lease defaults early in the pandemic.
Asked about whether those commercial lease agreements allow for rent relief under “force majeure clauses,” Anthony noted that such defenses aren’t as common as hoped. In fact, “[m]ost leases will not grant a tenant relief for a general pandemic-related purpose, unless they were poorly drafted, and most leases just aren’t,” he is quoted as saying.
The entire article is available here.
You can read more about the services that David Anthony provides to both commercial landlords and tenants at his firm biography page.