City, State Officials Halt Commercial Evictions

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A week after the World Health Organization declared the coronavirus outbreak a pandemic and President Trump subsequently declared a national state of emergency, state and local officials have enacted measures to mitigate the financial impact of the virus on commercial real estate tenants.

On Tuesday, Los Angeles Mayor Eric Garcetti announced a moratorium on commercial evictions. Effective immediately, the rule is intended to provide relief for tenants whose businesses were forced to close or have otherwise taken a hit in the COVID-19 outbreak. The ban will last until March 31 but could be extended.

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“Angelenos who own businesses in our city deserve peace of mind,” said Garcetti in a statement. “The moratorium will help ease some of the deepest concerns while we get through this crisis together.”

The order prohibits commercial landlords from evicting tenants which are able to show an inability to pay rent because of circumstances related to the  pandemic, according to the mayor’s office. Those circumstances can include loss of business income due to a coronavirus-related closure, child care costs stemming from school closures, health-care expenses related to the illness or to caring for a member of the tenant’s household.

Eligible tenants will be given up to three months following the expiration of the local emergency period to repay any back due rent.

Seattle Mayor Jenny Durkan announced similar guidelines on Tuesday, when she signed an emergency order prohibiting evictions of small businesses and nonprofits for 60 days, or until the end of the city’s emergency period. The order asks landlords to work out payment plans with struggling tenants and prohibits late fees.

Kansas has also taken action. Gov. Laura Kelly asked financial institutions to temporarily suspend both business and residential evictions to help those  impacted. The order suspends the initiation of  foreclosures or judicial proceedings, as well as commercial or residential evictions, until May 1.

The emergency measures come after schools, businesses, workplaces and institutions across the country were forced to shutter this week in an attempt to slow the spread of the virus. Retail and hospitality properties have been hit especially hard, as major commercial centers like the Las Vegas Strip have closed their doors. Current figures put the number of confirmed infections in the U.S. at nearly 9,000.