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NEW YORK CITY- As the coronavirus pandemic unfolds with no resolution for eradication, real estate stakeholders are on the sidelines trying to forecast just how much economic damage has been done, with many having their eyes toward the flood of forbearance requests mortgage servicers are fielding, Richard Green, director of the USC Lusk Center for Real Estate, tells GlobeSt.com.
"Mortgage service guys are dying because of forbearance [...] they don't have the cash-flow to meet their obligations to commercial mortgage-backed securities," he said." If that main channel of finance goes way, it will definitely have a broader impact."
Although many in the real estate industry are taking a wait and see approach because of the ambiguity surrounding the market, many are anxious to see what businesses will survive long enough to come out the other end of the crisis. Also, the current national unemployment rate of 20 percent has many teetering about how high it will rise, according to Green.
According to a recent GlobeSt.com article, amid economic changes, different lenders are taking their own respective precautions when it comes to affording borrowers forbearance, especially as it pertains to CMBS loans, where there are more hoops to jump through when requesting forbearance.
As the coronavirus continues to wreak havoc on the U.S. economy and the commercial real estate industry, more and more property owners are approaching their lenders. Many of these lenders are willing to work with borrowers but there are also plenty of examples of lenders denying the requests because they feel it is not necessary.
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Mariah Brown
Mariah Brown is the New York Bureau Chief and Real Estate Reporter for GlobeSt.com, covering the New York Metro area, Northeast region and national real estate trends. She is responsible for producing multi-media content, including articles, podcasts and video. Before joining the GlobeSt team, she served as a New York Times fellow, reported for the Associated Press in New York and Philadelphia and several other New York City-based outlets.
