The Small Business Administration has determined that commercial landlords, those who own apartment buildings, mobile home parks, campgrounds, and real estate developers are not eligible for the Paycheck Protection Program.
To be eligible, a real estate firm has to be able to show that more than half of its revenue comes from expenses charged for “services,” rather than rent.
With unemployment skyrocketing and a steep drop in rents collected, commercial landlords are concerned about not being able to pay their mortgage and are at the mercy of their lenders.
“As a response to potential rent shortfalls — although some landlords have reported better-than-expected numbers — banks are generally negotiating with borrowers on a case-by-case basis. At least one top multifamily lender offered relief in the form of six months of only interest and escrow payments or deferral of principal and interest for six months, payable at maturity.”