A report from the Wall Street Journal. "More than a year into the pandemic, high-rise office buildings are largely empty. About one of every two hotel rooms is unoccupied. Malls are struggling to attract shoppers. And yet by most measures, the U.S. commercial real-estate market is in remarkably solid shape. The market's resilience shows how the federal government's aggressive efforts to support the economy kept landlords from suffering steep losses. Banks have also offered delinquent property owners some slack, rather than foreclosing aggressively."

"Government and lender support for the market has masked deeper problems. The prices of malls and hotels are down significantly. Loan defaults and foreclosures are expected to increase as forbearance periods end and some lenders finally lose patience. Overall property returns would be worse without booming warehouses, up 25% over the past year. In a March report, Fitch Ratings said that if remote work lowers demand for office space by 10%, building valuations could fall by more than 40%."

From Bisnow. "Real estate attorneys surveyed by Bloomberg Law are almost all predicting defaults in retail and hospitality properties in 2021, but they also predict that office properties will see a large share of defaults this year. Starwood Property Trust CEO Barry Sternlicht said during the company's Q1 earnings call that office properties in gateway cities are going to be under enormous pressure going forward. Sternlicht singled out cities controlled by Democratic politicians for his ire, accusing them of putting landlords between a rock and a hard place, or between high taxes and rent controls."

"'We’re going to see some compression — significant compression in net rents, as rents fall, concessions go up,' Sternlicht said, referring to the New York and San Francisco office markets, where Starwood has no loan exposure. 'There’s such enormous shadow vacancy in both of those markets,' Sternlicht said. '… You need gain, you need rents to go up. It’s not holding your own, and expenses going up is going to mean your net profits are going down. So on the margin, these big cities are in trouble.'"

From WFAE 90.7. "North Carolina has had an eviction moratorium since last fall. Deidre Wilson is board president of the Greater Charlotte Apartment Association and she joins us now as part of our series, Rebuilding Charlotte. Q: How has it affected small landlords? You know, mom-and-pop operations versus some of your larger landlords that are more like companies or corporations? Wilson: I believe the mom-and-pop, it's been harder on them because they may have, let's say, 10 rentals and five of them may be delinquent — and that could financially destroy them."

The Real Deal on California. "Canfield Development has sold a newly built condominium-turned-luxury rental complex in Mid-Wilshire for $55 million. Canfield completed the four-story building last year and converted to rentals during the pandemic. The firm positioned it as a luxury property; units average 1,474 square feet, with rents topping out at around $7,000 a month. The property is so far 30 percent leased, according to the report."

"Multifamily investment sales cratered in Los Angeles during the pandemic-filled year. The top five apartment sales countywide in 2020 totaled $646 million, less than half the total from 2019."

The Napa Valley Register in California. "Fourteen months since the issuance of Napa County’s initial stay-at-home order, a number of local employers have no intent to return their employees to in-person work, a dynamic that has disrupted the city’s commercial real estate market. Commercial properties, especially office spaces, are sitting empty longer, said Randy Gularte, owner of Crown Realty Property Management, and many tenants are seeking to either end their leases or downsize."

"Joe Fischer, senior vice president of real estate at the commercial real estate firm Strong & Hayden, said he’d seen a number of tenants attempt to sublease their commercial leases during the pandemic, but demand has been similarly muted. It will be difficult for some landlords to come to terms with, he said."

"'It’s just hard, emotionally, to think something that you bought that was a really great investment for a long period of time is now not going to have the demand it has had for the last 10 years,' Fischer said. 'There are a lot of landlords that have not come to grips with the fact that we have this very significant oversupply in the market, and relatively limited demand, which means their properties are going to be vacant longer, or they’re going to have to do deals at rent numbers that are less than they’ve been used to for the past five years.'"

The New York Times. "Adelaida Martinez was attracted by the opportunity to invest in Skyloft Austin, an upscale student housing complex near her alma mater, the University of Texas at Austin, and collect a monthly dividend check. James Parziale put money into the same deal because he was impressed by the shiny new high-rise with its sun-drenched rooftop pool and door-to-door garbage collection service."

"Now Martinez and Parziale are among dozens of small investors who are suing, saying they were taken for a ride by a group of professional real estate investors who raised tens of millions of dollars from people like them to finance the purchase of the student dorm. The Skyloft investors say they don’t know where the money went, or who actually owns the building today, according to court filings in California, Texas and Delaware and interviews with a half-dozen investors and lawyers."

"Some court filings said that they were victims of a 'Ponzi-like' scheme, in which the promoter, Patrick Nelson, used proceeds from the Skyloft deal to invest in other student housing projects and enrich himself by 'transferring funds to offshore bank accounts.'"

"Parziale and his wife invested about $500,000 in the Skyloft deal. He said his brother-in-law invested another $500,000. Parziale said he faulted Nelson for not letting investors know what was going on and leaving them helpless. 'The sponsors of these deals are like cowboys,' Parziale said. 'They can do what they want.'"

From Blog TO in Canada. "Toronto's rental market took a big hit as a result of the pandemic, which drove rent prices down for 15 straight months in what was the country's most expensive city pre-COVID. Things like new Airbnb regulations, a lack of international students, people moving out of the city amid work-from-home trends, lower immigration, and other factors led to excess condo supply and extremely high vacancy rates."

"New data from liv.rent shows that downtown Toronto in particular, where condo prices have taken a bit of a hit so far this year despite the prices of all other housing types going up, saw rents for all units drop an average of around 18 per cent in the first three months of this year compared to the same time in 2020. Three-bedroom unfurnished apartments took the biggest hit in the city, down nearly 30 per cent in March specifically from an average of $3,861 last year to $2,803 this year, and down an average of 21.6 per cent over all three months compared to the same three in 2020."

"One-bedroom furnished apartments, perhaps most popular with international students, also haven't fared well lately, down 20.3 per cent year-over-year in March specifically, and 19.2 per cent year-over-year in the first quarter overall. The type that fared the best were two-bedroom unfurnished units, which were still down an average of 14.4 per cent year-over-year in the first quarter, and a staggering 21.7 per cent in March specifically."

From News.com.au in Australia. "Glass shattering without warning, cracks growing up to the roof and plummeting property values. This is the reality of many homeowners living in a Sydney suburb that has begun sinking into the ground below. Many residents in Spring Farm, in Sydney’s west, have been left hundreds of thousands of dollars out of pocket as they deal with damaged and potentially worthless properties."

"Sharon and Peter Luhr bought an investment property in Spring Farm in 2016 to help fund their retirement but instead of boosting their funds, the home has been slowly draining their savings. 'Every window and every door at the architraves are all cracked straight to the roof,' Mr Luhr told 10 News."

"With glass smashing and multiple cracks appearing over the house, the couple have been forced to reduce rent dramatically just to keep tenants. 'We have had doors in the house, glass doors, just smash with no one around,' Ms Luhr said. 'It’s gut wrenching to think you fork out all this money to buy something, whether it is your home that you live in or whether it is an investment home.'"

"It’s believed the issues at Spring Farm were triggered after the land was not filled and compacted properly, before building started. The soft land means brand new homes have begun to crack and fall apart as the earth shifts below. Spring Farm, which is situated between Camden and Campbelltown, was built on a former chicken farm and large swathes of industrial estate."

"Lead plaintiff Danny Moussa, who paid $560,000 for a house and land package at Spring Farm, told the Daily Telegraph he was losing sleep at night due to lying in bed and hearing the tiles and gyprock cracking. 'There’s this stress of not knowing if the house is going to come down on you one day,' he said."

"NSW Premier Gladys Berejiklian expressed sympathy for Spring Farm residents when asked about the situation during a press conference on Tuesday. 'I think it would be horrific for anyone who’s invested in their family home, in their forever home, to have to find themselves in those circumstances,' she said. 'I wish them well.'"