A report from the Globe and Mail. "It’s a troubling question that has been echoing through the condo towers in Canada’s largest cities for the past two weeks: Could the disaster in suburban Miami happen here? Existing Canadian condo rules have significant gaps, which have been further exposed by the highly speculative nature of the market in cities such as Toronto and Vancouver. 'I think there’s a rude awakening coming,' said Martin Gravel, a civil engineer who is also the president of the condo board of a downtown Toronto building."

"Condos are directed by boards of unpaid individuals, most of whom have no technical knowledge and may not even live in the building. The speculative nature of the condo market adds another layer of complexity, University of Windsor sociologist Randy Lippert, who wrote extensively about the tangle of competing interests on condo boards, added. 'It’s of no interest to the owners and boards to ever reveal all of the problems in their buildings,' he said."

From Boston Agent Magazine in Massachusetts. "'The condo market was on fire,' said Eric Glazer, attorney specializing in condominium and homeowner association law, and host of the weekly Condo Craze and HOAs radio show. 'There is no question that the condo market is going to take a hit because of the fear factor. I’ve already seen it in closings.'"

"Surprisingly, Florida law only requires disclosure on an individual unit. There is no law that requires disclosure on the common areas of a building or property. With the additional stress oceanfront buildings have from the sun, heat, wind, rain and salt-spray, beating on these structures year after year, the concrete breaks down and leaks and the steel inside the concrete rusts and dissolves inside the walls, balconies, and throughout the property’s infrastructure."

"'Condos have always been volatile,' said Ken H. Johnson, Ph.D., a real estate economist. 'They are the canary in the coal-mine for the real estate market. While the tragedy of a building falling down is new, the market volatility for condos is not. We don’t have specific research on something like this, but after hurricanes and other market pressures like recessions, there are going to be price impacts. It will probably last a year or two.'"

The New York Post. "Bob Ross is worried. Ross lives in Miami Bay Towers, across the marina from Palm Bay Towers, where the report, prepared in December, found 'structural deficiencies' in the 26-story, 68-unit building, one of the only ones in the city built over the water. 'Everybody is petrified, because as we’re looking at this monolith across the marina and if it came down, it would come down on us,' Ross said."

"Residents at the complex in Kissimmee, Florida, were advised to enter the buildings at their own risk. 'Probably everybody in South Florida has become aware of how they may be in the same position,' Ross said. 'It’s scaring the hell out of us.'"

From News 4 in Ohio. "Rob Vogt, a managing partner at VSI, says the high-end rental market was booming before the COVID-19 pandemic. 'Low vacancy rates, high rents, a willingness to develop properties, a willingness to lend money, a willingness to get zoning for projects,' he said, led to a lot of new high-end development that was scheduled to begin leasing in 2020. 'All this product comes online, they didn’t expect the pandemic to hit,' Vogt explained. 'They didn’t expect a lot of – a decline in household formations.'"

"The most startling finding from Vogt’s data, however, is that the availability of high-end rentals is outpacing the availability of affordable housing in Columbus. And soon there will be more luxury units (Class A) than non-luxury apartments (Classes B and C)."

From Fox 4 in Missouri. "Michael Francis Weinberger says for him, it’s not just about being hot during summertime. He says having no air conditioning at Plaza Club City apartments has been detrimental to his physical health. 'I’ve got the hospital bills, along with the bills collected from the vet, along with collected bills from the hotel I’m staying at,' he said. Weinberger collapsed in his apartment weeks after residents pleaded with management to fix the air conditioning system. 'This is a luxury apartment complex and I’m embarrassed to be telling people I’m living here right now.'"

From Globest. "As in other asset classes, lenders have been open to these talks, according to Bonnie Y. Hochman Rothell, partner and chair of the Litigation practice at Morris, Manning & Martin LLP. 'The majority of my clients on the lender side are working with them [apartment owners] quite extensively to be creative and to work through some of the foreclosure moratoriums,' Rothell says. 'On the lender side, for those loans that are technicall in default right now, we’ve tried to be proactive to renegotiate so there aren’t 1,000 foreclosures and bankruptcies at the end of this.'"

"Rothell does think there will be some foreclosures. 'It won’t be as dire as some of the predictions, but I think that there are definitely going to be some foreclosures,' she says. 'Some of my financial institution clients are gearing up for those. I think the reason for that is we’ve had some borrowers take the approach of not communicating with their lenders and not trying to work out the situation. In those instances, I think that the lenders are going to have no choice and, in fact, probably would be better off foreclosing.'"

The Colorado Springs Gazette. "In mostly normal times (which these are not), investing in commercial real estate is an attractive proposition. The investor buys or constructs a building for use in commercial activities — stores, restaurants, offices — using, for the most part, borrowed money. The investor then puts tenants in the building who pay rent and an additional amount to cover operating costs — insurance, maintenance, repairs, real estate taxes, utilities. The investor uses the rent to make the mortgage payments and takes home what’s left as a return on investment."

"But what happens when a pandemic comes along? The short answer is — legal chaos. Now the investor must try to cover operating expenses previously paid by the tenants. Maintenance gets postponed, repairs are no longer made when needed, and landscaping is neglected and dies. With no rental income, the investor defaults on the mortgage. Then the mortgage holder, no longer receiving payments from its borrower, defaults on its obligations and finds itself fending off multiple creditors. The mortgage holder could, in theory, foreclose on the property, but that would mean taking back a property having no rental income and in a deteriorating condition."

"Or the mortgage holder could sue its defaulting borrower for the unpaid balance of the loan, but since the borrower is now insolvent and threatening bankruptcy, this would be another exercise in throwing good money after bad. To further complicate matters, into the mix comes government save-the-economy assistance. This generates additional negotiations as to how the government money will be used. Tenants, for example, want the money to cover their obligation for unpaid rent. Property investors want the money to cover their defaulted loan payments."

"These negotiations are driven by the reality that trying to enforce legal obligations against parties unable to pay is a waste of resources and hat waiting out the storm is the only viable option. That’s the situation commercial real estate investors now find themselves in, and it will likely take years for something approaching normalcy to return. Along the way, there will continue to be casualties and the survivors will have deep wounds."

From Penn Live. "Pistachios in California, citrus in Florida, hotels, retail malls and mobile home parks across 18 states. And, let’s not forget, the former site of The Patriot-News in downtown Harrisburg. Pennsylvania taxpayers own all this and more thanks to several decades' of investments made by the Public School Employees’ Retirement System (PSERS), the pension fund that safeguards the retirements of some 500,000 educators statewide."

"The property that drew the attention of federal prosecutors, at least according to The Philadelphia Inquirer, was the long-vacant former Patriot-News headquarters in downtown Harrisburg. 'Someone got hosed,' said a former PSERS employee, who spoke on the condition of anonymity to avoid reprisal in their current job. 'Either PennLive received less than the land was worth or the state of Pennsylvania paid far more than it was.'"

"Nori Gerardo Lietz, a senior lecturer at Harvard Business School who’s advised public pension funds, said there’s nothing fundamentally wrong with such direct investments but pension systems must pay close attention to their portfolios to ensure they’re diversified across different economic sectors and geographically across different types of local economies. 'You wouldn’t want all your portfolio to be in Silicon Valley, Boston and Austin because all of those places are driven by technology right now,' she said."

The Times of San Diego. "The rise of the hybrid office poses a headwind to workspace demand in cities like New York and San Francisco, where there have been few big-name office building sales in recent months. Institutional holdings of office assets in the two cities are valued at $231 billion and $128 billion, respectively, according to LaSalle Investment Management. While leasing activity has rebounded since the lows of the pandemic, rental prices are weak and vacancy rates remain high, weighing on the value of office buildings and stymying deal activity."

"Total sales of office properties in Manhattan, for example, slid by more than half to $5.4 billion last year and were just $41.9 million in the first quarter of 2021, according to Cushman & Wakefield Plc. 'Prices in those big global gateway cities – New York, San Francisco – they’re the poster child, they’re soft,' said Mark Zandi, chief economist at Moody’s Analytics."

The Austin Business Journal in Texas. "Another property once owned by Nate Paul's World Class Holdings has been sold at auction. The downtown building that houses The Capital Grille at 117 W. Fourth St. was purchased July 6 by the lender for the property. It's the latest step in an ongoing dispute between the group and World Class. Some might remember the site, near Colorado Street, as the old Spaghetti Warehouse. The Hardeman group, through an entity called Colorado Third Street LLC, submitted the only offer: an $8.76 million credit bid, which includes debt owed on the real estate."

"World Class rose to prominence in recent years as the firm scooped up valuable properties all over Austin — from downtown sites ripe for redevelopment to a huge corporate campus to shopping centers. But many real estate insiders have raised questions about why he hasn't sold or developed most of the sites. World Class has been hobbled since federal authorities raided it's offices in August 2019 for reasons that have still not been made public. The firm has since filed more than 20 bankruptcies, the latest on July 6 for a prominent North Austin shopping center, Arboretum Crossing. This makes three consecutive months when World Class properties have been sold at foreclosure auctions on the back steps of the Travis County Courthouse."

The New York Real Estate Journal. "Josh Goldflam, principal of Manhattan based commercial real estate firm Highcap Group along with senior broker Charles Chang have arranged the sale of 33 & 35 Howard St. The buildings are located in the SoHo neighborhood and sold for $11.2 million in an all-cash deal. The total sale price of $11.2 million equates to $700 per existing s/f. The seller was the Spitzer Family who has owned the properties for 45 years, and the buyer was landlord and developer Javeri Capital."

"Goldflam said, 'This deal was agreed to and signed at a time when COVID was still terrorizing the downtown real estate market, particularly retail properties in Soho. When buyers and brokers look back in the future at distressed COVID sales, this property will be sure to come to mind.'"