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The Real Estate Market – Warehouses, Ports and Addition by Subdivision

All of us know the real estate sector took a beating throughout the least year or so, however, it wasn’t all doom and gloom. In particular, you stay fairly busy in some specific segments of the real estate fund market, mainly for lenders but such as on a borrower-side trade in November that at the time was the biggest hotel sale in funding because the onset of COVID-19 in the first quarter of 2020. Can you tell us about your expertise in a few of those flourishing areas of the housing market?
Steve Hamilton: Sure. As we know, 2020 was a little bit of a dumpster fire for the real estate business, but there were several highlights also there were some places which did boom. We saw a great deal of action, at least at the construction loan sector of everything I do, between industrial buildings and warehouses such as distribution facilities. We saw numerous retail jobs which ordinarily people would believe were fighting during stay-at-home orders, even throughout COVID, but a few developers and retailers really found opportunities there. An instance –at many of shopping centers where you had the likes of Toys-R-Us along with other insolvent firms, there was space which was available and you saw Amazon, as an instance, come in fairly hard in the past half of the year rebranding those shopping facilities or those stores with areas like their four-star stores where they bring goods direct to customers. Instead of simply having them delivered to their front door they’d put some of the most popular things which are trending on their online portals into brick-and-mortar where folks want immediate gratification. They wish to pick this up. They can’t wait a day or 2 for Prime. They wish to go get it today. And they’ve gone beyond Whole Foods. There are currently Amazon-themed grocery stores. So that was kind of a new thing which we watched –not just construction loans but also a retooling of existing retail facilities around this marquis product since the one thing which lenders definitely like is consistency. What we saw during the pandemic was there are certain retail establishments that people need regardless of what is going on. Grocery stores and the Targets of earth are the types of shops that people still have to visit once or twice every week to pick up the essentials. Therefore any retail facilities which are offered by a grocery store–people are super-great credit for the lenders and they flock to people.
You mentioned the funding for the resort up in Orange County I was involved . This was an opportunity that one of our borrowers had to buy a marquis merchandise at a discount since the resort had been shuttered for some time or was at least under restricted use, also with the right direction and eyesight, they view that merchandise or home as being a boon, that they are going to redevelop it and it is going to be a marquis resort in the near future when they finish their improvements. So there are some bright spots out there in the event that you look hard enough; you just need to find the ideal patrons doing the right kind of development. These large industrial buildings which are being used for distribution facilities for the likes of Amazon ports and such–that is definitely something which the lenders are searching for, and we did quite a few loans in the second half last year and the start part of 2021 for those types of products.
Simon: Individuals are certainly significant contrasts to some other subsectors in real estate for example mom-and-pop retail, specific big box stores, and strip malls which have taken huge hits. I understand there has also been a sector and demographic change due to, or accelerated by, the pandemic–creating opportunities for new house construction in addition to for apartments and midsize and more compact cities in certain areas of the country. How do you tell us all about those opportunities?
Hamilton: That is another thing which was a little surprising at the latter half 2020 and today into 2021–there’s a flourishing flat market out there. A great deal of developers and lenders alike are developing new turnkey, luxury apartments, many in that which we call secondary cities or outside the primary urban locations. We’ve closed on multiple apartment loans in the last six months where you have millennials who are visiting the huge cities. With COVID, they are not tied to the large urban centers they were when they had to commute into work daily, so you’ve noticed a motion where these apartment projects–particularly in the western states where I primarily do my deals–they’ve become quite appealing. Moreover, I’ve seen a variety of new subdivisions popping up along with subdivision loans. The housing market is quite hot. You’ve people, again, fleeing in the urban centers and searching for a house to themselves where they are not sharing an elevator or shared amenities with people and they need to space out. They want a house with a third bedroom or a fourth bedroom or even a fifth bedroom or whatever it can be to be used as a home office. So we’ve seen a variety of fresh subdivision loans come online in the last six weeks, and anyone who has tracked home prices throughout the pandemic, it definitely does not monitor the despair and gloom that people have called. In actuality, at least here in the West and I believe in other major metropolitan areas, the housing market is going crazy. Lenders see that there is this trip into the suburbs along with the values are there, along with the lenders will always loan at which the value is. I see that process continuing today that the genie is out of the jar –many people are utilized to operating from home and will continue to want to accomplish this. Having that house office and much more room to breathe is definitely a thing that people will be searching for.
Simon: I’d love to return to something you mentioned previously regarding large distribution centers, warehouses, and port cities or transportation hubs. I suppose companies can check at those as a means of lowering operating expenses when they can take advantage of the market in that way, and it seems like a possible win for sure areas which need to shore up their tax base in addition to provide jobs and attract new residents. What are your ideas on this subject of growth?
The interface of Jacksonville has been expanding over the last ten years, along with the surrounding areas in Jacksonville that’s the biggest metropolitan region within the USA, has risen exponentially during that time, therefore there are opportunities there. Since the e-commerce world grows, the distribution facilities are getting increasingly more important for those e-retailers. They are interested in being able to get their merchandise off the boat and at a distribution center and quickly to the end user so that they can meet their one-day shipping or two-day shipping or in some instances six-hour shipping, and thus having proximity to ports–whether it’s Jacksonville, New Haven, Long Beach–with proximity to those ports and also to major distribution hubs along with the highway system will be critical. Along with the Biden administration is pledging two billion bucks. That is going to be a enormous sum of money going toward ports and bridges and expanding what is already there and making it modern, and I believe the banks will follow that. If the programmers are constructing warehouse facilities, cold storage, then what are you, to serve people e-retailers, the lenders will follow along with love to see credit when if you have the Amazons or the Wal-Marts of the planet putting in distribution facilities –that is blue chip. That is gold star. The lenders follow that. The programmers seek those tenants out, and now I definitely see those port areas being farther siphoned and moving toward a future where there’ll be increasingly more distribution facilities in those areas to be able to meet the requirements of the customers who currently have a slightly insatiable desire to get things delivered at a minute’s notice. I definitely see that trend continuing post-COVID.
Simon: It seems like we’ve got a subject for a future episode–that the tie-in of real estate and infrastructure. Thanks so much for this look at a few of the bright spots in what was an otherwise gloomy season for new real estate projects and funding. …

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The Real Estate Market – Warehouses, Ports and Addition by Subdivision

By Pillsbury’s Construction & Real Estate Law Team

In episode #26 of Industry Insights tradition, Steve Hamilton joins host Joel Simon to examine specific segments of the real estate market and relevant funding that remained solid in the midst of this pandemic.
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Insolvency Issues, Real Estate and COVID-19

Over the past year, our lawyers have researched numerous bankruptcy topics affecting property. Together, the alarms within this show handle many aspects (and possible applications) of the Bankruptcy Code as possible balm and bane for owners, owners and landlords seeking to browse a landscape created exponentially more treacherous by COVID-19 in Insolvency Issues, Real Estate and COVID-19.…

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Insolvency Issues, Real Estate and COVID-19

By Pillsbury’s Construction & Real Estate Law Team

Over the last year, our lawyers have researched numerous bankruptcy topics affecting real estate. Together, the alerts within this series handle many facets (and potential applications) of the Bankruptcy Code as potential balm and bane for owners, owners and creditors seeking to browse a landscape made more harmful by COVID-19 in Insolvency Issues, Real Estate and COVID-19.…

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What New Corporate Disclosures Mean For Real Estate

The management and beneficial ownership of real estate at the U.S. has been relatively easy to hide. Christian A. Buerger, David L. Miller, and Andrew J. Weiner talk how this disclosure regime is about the change radically in”What New Corporate Disclosures Mean For Real Estate.”…

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What New Corporate Disclosures Mean For Real Estate

By Pillsbury’s Construction & Real Estate Law Team

The management and beneficial ownership of real estate from the U.S. is relatively easy to hide. Christian A. Buerger, David L. Miller, and Andrew J. Weiner discuss how this reform regime is about the change radically in”What New Corporate Disclosures Requires For Real Estate.”…

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ABA/IPT’s 2021 Advanced Property Tax Seminar

Pillsbury Spouse Breann Robowski will present during ABA/IPT’s 2021 Advanced Property Tax Seminar on March 18.

Breann will present on the Subject,”Valuing the Fee Simple Interest for Tax Legislation in Situations Not Involving’darkened Shops. ”’ to find out more and to register, please see here.…

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ABA/IPT’s 2021 Advanced Property Tax Seminar

From Pillsbury’s Construction & Real Estate Law Team

Pillsbury spouse Breann Robowski will present throughout ABA/IPT’s 2021 Advanced Property Tax Seminar on March 18. Breann will present on the Subject,”Valuing the Fee Simple Interest for Tax Legislation in Situations Not Involving’Dark Stores. ”’ to find out more and to enroll, please see here.…

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Carbon Emissions and the NYC Climate Mobilization Act

The Climate Mobilization Act constitutes a profound shift in the law of commercial real estate in New York City–along with also all stakeholders including building owners, investors, sellers and buyers, tenants, and lenders will need to think about how to measure and allocate the expenses of funding (or non-compliance). Back in”Sustainable Buildings and Development: Carbon Emissions and the Current Climate Mobilization Act of New York City”, colleagues Caroline A. Harcourt, Sheila McCafferty Harvey, also Jacob A. Axelrod discuss the potential Effect of the recently commissioned Climate Mobilization Act (CMA or the Act) for developers and building owners, lenders and tenants working or underwriting loans in New York City.…

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Carbon Emissions and the NYC Climate Mobilization Act

By Pillsbury’s Construction & Real Estate Law Team

The Climate Mobilization Act constitutes a profound change from the law of commercial real estate in New York City–along with all stakeholders including building owners, investors, sellers and purchasers, tenants, and lenders will need to take into account how to quantify and allocate the costs of compliance (or non-compliance). Back in”Sustainable Buildings and Development: Carbon Emissions and the Recent Climate Mobilization Act of New York City”, coworkers Caroline A. Harcourt, Sheila McCafferty Harvey, also Jacob A. Axelrod talk about the potential Effect of the recently commissioned Climate Mobilization Act (CMA or the Act) for developers and building owners, lenders and tenants operating or underwriting loans from Nyc.…

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Shuttered Venue Operators Grant Program Updates

Although the Small Business Administration hasn’t yet opened the program to grant applicants, the agency recently published a string of FAQs that address particular definitions and eligibility standards for prospective grantees. Alexander B. Ginsberg, David L. Miller, also Toni Suh provide advice on the upgraded Frequently Asked Questions (FAQs) for the Shuttered Venue Operators Grant (Grant) Program released by the SBA from the Current alert Updates on Shuttered Venue Operators Grant Program.…

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Shuttered Venue Operators Grant Program Updates

By Pillsbury’s Construction & Real Estate Law Team

Although the Small Business Administration hasn’t yet opened the application to grant creditors, the agency recently released a set of FAQs that address specific definitions and eligibility standards for potential grantees. Alexander B. Ginsberg, David L. Miller, also Toni Suh provide insights on the updated Frequently Asked Questions (FAQs) for the Shuttered Venue Operators Grant (Grant) Program released by the SBA in the recent alert Updates on Shuttered Venue Operators Grant Program.…

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New 2021 ALTA/NSPS Land Title Survey Standards Effective February 23, 2021

The very first such set of criteria was designed in 1962 and has since been revised 10 occasions. The criteria are currently updated every five years and are relied on by real estate professionals, such as purchasers, lenders, title insurance companies and their attorneys, nationally. The substantial changes between the 2021 criteria as well as also the previous 2016 criteria are summarized below.
Survey Matters
The 2021 criteria clarify that only survey-related matters have to be summarized on the survey. This revision was intended to foreclose a practice common among several institutional creditors to require that the survey list all items displayed in Schedule BII of the name commitment on the surface of the survey regardless of whether those things may in reality be survey associated with The 2021 criteria also add a requirement that the surveyor contain a notice specifying whether the location of some right of way, easement or other survey-related thing is shown on the survey. This change incorporates common lender and purchaser requirements that weren’t previously enumerated in the survey criteria.
Additionally, a new provision requires that the surveyor to advise the name company if it’s conscious of a recorded easement not listed in the name work from the process of preparing the survey. Until the name firm provides the surveyor with evidence of a release of the easement, then the surveyor is required to demonstrate that the easement on the surface of the survey, together with a notice that the title company was advised of the same.
Utilities
The survey must reveal certain things observed through the surveyor’s fieldwork. The 2021 criteria specifically add utility locate markings for this listing, for example, source of the markings, with a notice in case unknown. This condition was accidentally deleted when the 2016 criteria were published.
Cosmetic Candles
The survey criteria incorporate a listing of items that could present issues beyond those typically encountered on a survey (e.g., marinas, campgrounds, mobile home parks, easements, leases and other non-fee straightforward interests), and which should be specifically negotiated between the client, lender, insurer and surveyor. The 2021 criteria add mineral interests for this listing.
Table A Items
Table A of the minimum standard detail requirements puts on a listing of optional surveyor responsibilities and specifications, which may be requested by the client. Any such items are subject to negotiation between the client and the surveyor, such as any extra fee associated thereto.
The 2021 criteria delete two Table A items that were included in the 2016 criteria. Former item 10(b) was deleted, which necessitated a determination of whether specific walls are plumb (i.e.( perfectly perpendicular ). This item was eliminated since it is not rooted in any name concern (apart from the chance of an encroachment, that is individually addressed in the criteria ). Additionally, Item 18 was deleted, which necessitated the position of wetland delineation markers (or a notice disclosing the lack thereof). This item has been the source of confusion because its first introduction as a portion of the 2011 criteria. In 2016, the ALTA/NSPS committee attempted to describe that the surveyor is not required to actually delineate wetlands, but simply to find delineation markers previously set with a wetlands biologist. Confusion persisted, and thus the committee chose to remove this item completely.
Table A objects 6(a) and 6(b), that relate to zoning information, were altered to clarify that any zoning letter or report provided to the surveyor from the client or the client’s designated representative must be”special to the surveyed property” This change was intended to avoid a client’s delivery of a copy of a whole zoning ordinance into the surveyor with the intention that the surveyor ascertain whether and to the extent that ordinance applies to the surveyed property.
The 2021 criteria also modify Table A item 11, related to underground utilities. Under the 2016 criteria, this item required that the surveyor to find underground utilities based on observed signs, plans obtained through the surveyor’s petition to a utility business, and markers asked by the surveyor pursuant to an 811 utility find or similar petition. The standards change the onus away from the surveyor. Under new item 11(a), the surveyor is required to demonstrate signs of underground utilities based on reports or plans furnished by the client (with reference regarding the sources of data ). Item 11(b) requires the surveyor to show markings coordinated with the surveyor pursuant to a private utility find.
As mentioned above, the 2021 criteria will become effective on February 23, 2021, that coincides with the date of this historical festival of this Roman god Terminus, shield of border markers. When a contract is entered into for surveying services that commence before this effective date but won’t be finished until after the new criteria are in effect, the parties must specifically discuss that set of criteria will apply and contain an suitable clause in their contract to that purpose.
It’s important that purchasers, lenders, title insurance companies and other business participants familiarize themselves with all the 2021 criteria before contracting for, either negotiating or taking the ALTA/NSPS Land Title Survey from and following that the 2021 standards’ effective date. When you have any queries related to this particular topic, please contact the authors.…

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New 2021 ALTA/NSPS Land Title Survey Standards Effective February 23, 2021

From Emily K. Bias and Josh D. Morton

The”Minimum Standard Detail Requirements for ALTA/NSPS Land Title Surveys” is a document jointly promulgated by the American Land Title Association (ALTA), symbolizing the title insurance industry, along with the National Society of Professional Surveyors (NSPS), representing skilled land surveyors, which describes the uniform minimum criteria with which surveyors must comply if preparing a survey to be used by a title insurance company with the intention of deleting the general poll exclusion from ALTA title policy forms. The very first such set of criteria was designed in 1962 and has been revised 10 times. The criteria are updated every five years and are relied on by real estate professionals, including buyers, lenders, title insurance companies and their attorneys, nationally. In October 2020, a joint committee comprising representatives of both ALTA and NSPS adopted the”2021 Minimum Standard Detail Requirements for ALTA/NSPS Land Title Surveys,” which will become effective on February 23, 2021. The significant changes involving the 2021 criteria as well as also the previous 2016 criteria are summarized below.
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