Commercial Real Estate – 2021 Market Update
August 17, 2021
2020 in Hindsight
2020 was a difficult year. The COVID-19 pandemic impacted the economy across all industries, especially real estate. As the lockdown extended well beyond initial expectations, commercial lending became virtually impossible to obtain given the instability of the market and lack of forecast ability. As a result, we saw a number of commercial real estate deals delayed indefinitely and eventually terminated. On the leasing side, we had tenants defaulting on their leases and asserting force majeure as a means of temporary rent relief. But, as 2020 dragged on and we learned to navigate the unprecedented time, we finally started to see a light at the end of the tunnel as we moved into 2021.
In the first two quarters of 2021, we saw an uptick in overall real estate market activity. Delayed deals were back on track to close and terminated deals were brought back to life. This is mainly due to the steadying of the market and early indicators of economic recovery. The Federal Reserve has lowered interest rates to continue the economic recovery and commercial lenders have started to revert to pre-pandemic lending practices. This has allowed businesses to purchase properties based on projected post-pandemic growth. On the leasing side, as many businesses have continued work from home practices and/or adopted hybrid work from home structures, many tenants have opted to restructure their current leases. Landlords have shown flexibility in working with tenants to mutually benefit from continued leasing of commercial space.
What to Do
The time to make your next real estate move is now. Buyers should take advantage of the lower interest rates. Lessees should take advantage of accommodating landlords. Because, as we all know, this won’t last.
How We Can Help You
Here at GCT, we have a team of attorneys that concentrate in commercial real estate, specifically, advising clients on potential acquisitions and divestitures, obtaining commercial lending, and leasing properties in the City of Chicago and surrounding suburbs. Over the past year, we have helped our clients not only survive the pandemic, but adapt and grow as we advised them on their real estate ventures.
Who to Call?
To discuss your specific needs, feel free to contact Darrin Baim (312.696.1350), Margaret Christie (312.696.2042), Brianna Golan (312.696.2636), Stephen Golan (312.696.2031), Joy Mkrdichian (312.696.1371), Donald Rubin (312.696.2641), David Saltiel (312.696.2642) or Anthony Taglia (312.696.2038).