statute of limitations would run out on that same date in 2026 . Now if an injury occurs at any point in the future , say in 2028 , that statute of limitations to challenge that ruling would run six years from that date .
Combined , Loper Bright and Corner Post are likely to result in numerous challenges to federal agency decisions , even those that have been previously adjudicated and were thought to be settled law , notes Smith .
Massive Power Shift
Legal experts agree that this is a landmark decision because it shifts the balance of power from the administrative agencies , such as the Environmental Protection Agency ( EPA ), Housing and Urban Development ( HUD ), Occupational Safety and Health Administration ( OSHA ), and Federal Deposit Insurance Corp . ( FDIC ) among others , back to the courts . However , the ruling only applies to situations where there is either ambiguity or an administrative gap in understanding . “ This is really about power to review and then reject these interpretations that the federal administrative agencies have made ,” says Smith .
The Loper Bright decision will undoubtedly create numerous ripple effects for the commercial real estate industry . Some of the bigger issues likely to impact the commercial real estate industry include :
• Fair Housing Laws administered by HUD
• Fair Credit Reporting Act and regulatory oversight on banking , which has implications for real estate financing
• Laws related to environmental testing , brownfield cleanup , clean air and clean water provisions as regulated by the EPA or Army Corps of Engineers
• Land use and zoning
• Government contracts
• Labor laws and OSHA requirements
Previously , developers and owners were in a situation where they had to fight city hall or fight these agencies , which was somewhat impossible . Now , if it ’ s important enough and you ’ re willing to bear the costs , you can adjudicate a decision and fight for a better result , says Hampton Friedman , CCIM , JD , Vice President – Brokerage at Equity LLC in Austin , Texas . “ I feel like it gives the players a lot more power ,” he says .
“ What ’ s going to be interesting is seeing the consequences and the unintended consequences ,” adds Friedman .
Everyone is talking about areas that are likely to be impacted , such as environmental , planning , zoning , fair housing and lending . “ We all see the obvious ones . What ’ s going to be interesting is seeing the consequences and the unintended consequences ,” adds Friedman . “ These consequences will have to play out over time , and a lot of them will be unintended , but it gives real estate people a fair fight so that the EPA or planning or zoning can ’ t come in and just blindly drop regulations .”
Leveling the Playing Field
The expectation is that the change will be more beneficial to the regulated parties . “ If you looked at this as a seesaw where you had the administrative agencies being this 150-pound kid at one end , and at the other end the regulated party is up in the air because of that bigger weight ,” says Smith . Now the weight of that 150-pound kid has been winnowed down and that seesaw is going to be a little more balanced , and perhaps lean more in favor of the regulated party , he adds .
Many cities are very restrictive in their zoning and development , and it can take 12 to 24 months just to get a site plan approved . The hope is that this ruling will rein in regulatory agencies and make it easier to move projects forward . Likely , some of the large firms with deep pockets will pave the way with challenges that will ultimately trickle down to the smaller players .
Easing some of those regulatory requirements could make it easier to move development projects forward . “ The things that impact our business from a local level are mainly environmental issues ,” says Bill Adams , CCIM , President of Adams Commercial Real Estate in Atlanta . As an urban firm in the Atlanta market , Adams encounters environmental issues in just about every one of the transactions he works on with clients . “ So , if that eases up , then that will make life a little bit easier for us ,” he adds .
One challenge with the move back to the courts is that it could result in greater disparity in rulings . For example , if you ’ re dealing with the EPA , you know that you ’ re going to get one answer . But in the federal court system , you may have a judge that rules in your favor in one district and not in another . That creates more uncertainty and confusion , says Adams . “ Whether you like the existing rules or not , business doesn ’ t like uncertainty ,” he says .
Wave of Lawsuits Ahead
The near-term impact is that this new ruling creates a lot of uncertainty and chaos . “ The real rub of this is that we don ' t know what the courts are going to say ,” says Smith . A federal court may decide to side with the regulatory agency , or they might not . In addition , federal courts are not all the same . For example , a court in New York might decide differently than a court in Texas looking at the very same issue .
One thing that everyone can agree on is that the Loper Bright ruling is going to unleash a lot of legal challenges , likely with some lawsuits filed before year-end . The litigation of those challenges will take time to work their way through the court system . Once those decisions start to emerge , there will be case law and precedence that start to indicate a path forward on issues .
“ Will we get immediate answers ? No , simply because the path through the court system can be pretty long ,” says Smith . It could be two-plus years before the initial rulings start to frame the situation , and it will be longer to determine whether or not there will be disparity in the rulings . Even though the pace of change will be slow , regulated parties are going to be much better off simply because they are going to have more power and won ’ t be just steamrolled by the administrative agencies , he adds .
The best advice for CCIMs in this changing environment is to be aware of the changing landscape and stay informed on decisions that may impact their business focus specifically . ■
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