PUBLIC SERVICE ANNOUNCEMENT! Post-COVID-19 RE Syndrome
If you are like most of us in real estate, you are probably feeling the effects of a condition called POST COVID-19 RE SYNDROM.
Some of the more noted symptoms include, but are not limited to:
- High Interest Rates
- 12-18 Month Interest Reserves
- Lender required Escrow for additional Interest Rate Cap
- Capital Call-like symptoms
- General fogginess after listening to various Fed statements
Currently, there is no known cure for Post-COVID-19 RE SYNDROM; however, there is proven treatment for these symptoms to alleviate long-term distressed conditions:
- Communication (weekly or more with your property management company);
- Asset Manage like you have never asset managed before;
- Transparent monthly updates with your investor partners as to what you are seeing and (if applicable) a heads’ up for any voluntary capital calls and/or lending opportunities.
- A “blind study” was probably conducted that showed, when providing notice of a capital call, symptoms are greatly reduced if you can provide examples to investor partners as to the effect of adding more capital or not adding more capital, as it pertains to his/her investment
- Regular visits to legal counsel to discuss any adverse financial reactions to current lender and/or preferred equity provisions.
While these Post-COVID-19 RE Symptoms are not permanent, some professionals believe that they may continue for another 6-9 months before interest rate vaccines is introduced to the public. Even if you are currently asymptomatic, we strongly encourage you to seek legal help in the event you become afflicted with these symptoms and they last longer than 6 months.
To learn more about the symptoms, email us at info@kaliserlaw.com.