Virtually all sectors report at least some of their tenants have requested rent deferral plans , with the highest concentrations in the commercial real estate sector , where some respondents reported between 90 % and 100 % of their tenants have requested rent deferrals . The request rate is much lower on the residential side , with residential real estate companies reporting 5 % or fewer of their tenants have requested rent deferrals . Overall , respondents report that 24 % of tenants across all sectors have requested a rent deferral .
Of those with rent deferrals , 65 % have a formal payment plan signed by all parties in place , and 40 % indicate they are directing tenants to rental assistance resources including government programs , state or local grants , or other resources .
The most popular resources are the Small Business Administration ( SBA ) for Paycheck Protection Program ( PPP ) loans , which can be used to fund critical business expenses including rent and utilities in addition to payroll and healthcare costs ( talk with your financial advisor to get a full picture of what expenses can be covered by PPP loan proceeds , or
contact Barnes Dennig to talk with one of our COVID-19 advisory team members .) A few respondents are directing tenants to Economic Injury Disaster Loans ( EIDL ), also available from the SBA .
Other resources mentioned include local not-for-profit agencies , county resources , and the Indiana Housing and Community Development Association ( IHCDA ).
Property owners are working with tenants in other ways , including offering more flexible payment terms – one reported having tenants pay a reduced rent during the pandemic , with rent increasing over the following 12-month period as pandemic restrictions loosen . And while respondents report working closely with tenants , some also say they ’ re keeping a close eye on state policies on evictions .
While the real estate industry doesn ’ t necessarily offer the same opportunity to develop new lines of business as some other industries , there are still creative strategies and tactics in play : 48 % of respondents reporting adopting new practices to offset reduced revenues .
In addition to making use of PPP loans and other economic relief initiatives , respondents say they ’ ve obtained long-term interest rate concessions from banks , deferred capital expenses , and requested deferral of mortgage principal payments to mitigate reduced rental revenues .
Still others are expanding to related business segments or relying on other sources of income , including revenues from cell towers located on their property and billboard rental revenues . One respondent noted