Capital Market Update: Key Commercial Real Estate Provisions in $2 Trillion Stimulus Package

With the Coronavirus outbreak causing uncertainty amongst businesses Nationwide, we want you to know that our Capital Markets team is available to help you navigate through this unfamiliar time. As always, Faris Lee will continue to provide the highest level of capital markets advisory, the latest financial markets news, quality solutions and execution.

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Here are some highlights of $2T stimulus bill:

Loans and Guarantees to Businesses, State and Local Governments:
$500 billion. Includes up to $50 billion for passenger airlines and $8 billion for air cargo carriers, half the money specifically for paying workers. $17 billion for “businesses critical to maintaining national security.” Companies accepting loans may not repurchase outstanding stock or pay dividends until one year after borrowing is repaid; must maintain employment levels they had March 24, 2020, “to the extent practicable” through Sept. 30, and not cut jobs by over 10 percent from that level; or give raises to executives earning over $425,000 annually until loan repaid. Companies are not eligible for loans if top Trump administration officials, members of Congress or their families have 20% control.

Small Businesses:
Includes $350 billion in loans for companies with 500 employees or fewer, including nonprofits, self-employed people and hotel and restaurant chains with up to 500 workers per location. The government provides eight weeks of cash assistance through loans to cover payroll, rent, and other expenses, much of which would be forgiven if the company retains workers. Also, $17 billion to help small businesses repay existing loans; $10 billion for grants up to $10,000 for small businesses to pay operating costs.

Emergency Unemployment Insurance:
$150 billion. Includes $100 billion for grants to hospitals, public and nonprofit health organizations and Medicare and Medicaid suppliers.

Health Care:
The passage of the emergency rescue plan is encouraging but until the pandemic is stabilized, fiscal and monetary policymakers are buying time. The virus will continue to impact the economy until we find a cure/vaccine.

Aid to State and Local Governments:
$150 billion, at least $1.25 billion for smallest states.

Direct Payments to People:
One-time payments of $1,200 per adult, $2,400 per couple, $500 per child. Amounts begin phasing out at $75,000 for individuals, $150,000 per couple.

Tax Breaks:
Temporarily waives penalties for virus-related early withdrawals, eases required minimum annual disbursements from some retirement accounts; increases deductions for charitable contributions. Employers who pay furloughed workers can get tax credits for some of those payments. Postpones business payments of payroll taxes until 2021 or 2022.

Department of Homeland Security:
$45 billion for a disaster relief fund to reimburse state and local governments for medical response, community services, other safety measures. Extends the federal deadline for people getting driver’s licenses with enhanced security features, called REAL ID, from Oct. 1, 2020, to Sept. 30, 2021.

Education:
$31 billion. Includes $13.5 billion for states to distribute to local schools and programs, $14 billion for universities and colleges..

Coronavirus Treatments:
$27 billion for research and development of vaccines and treatments, stockpiling medical supplies.

Transportation:
Includes $25 billion for public transit systems; $10 billion for publicly owned commercial airports, intended to sustain 430,000 transit jobs; $1 billion for Amtrak.

Veterans:
Includes $25 billion for public transit systems; $10 billion for publicly owned commercial airports, intended to sustain 430,000 transit jobs; $1 billion for Amtrak.

Food and Agriculture:
$15.5 billion for food stamps; $14 billion for supporting farm income and crop prices; $9.5 billion for specific producers including specialty crops, dairy, and livestock; $8.8 billion child nutrition. Money for food banks, farmers’ markets.

Defense:
$10.5 billion for Defense Department, including $1.5 billion to nearly triple the 4,300 beds currently in military hospitals; $1.4 billion for states to deploy up to 20,000 members of National Guard for six months; $1 billion under Defense Production Act to help private industry boost production of medical gear. Money cannot be used to build President Donald Trump’s proposed wall along the Mexican border.

Social Programs:
Includes $3.5 billion in grants for child care and early education programs; $1 billion in grants to help communities address local economic problems; $900 million in heating, cooling aid for low-income families; $750 million for extra staffing for Head Start programs.

Economic Aid to Communities:
$5 billion in Community Development Block Grants to help state and local governments expand health facilities, child care centers, food banks, and senior services; $4 billion in assistance for homeless people; $3 billion for low-income renters; $1.5 billion to help communities rebuild local industries including tourism, industry supply chains, business loans; $300 million for the fishing industry.

Native American Communities:
$2 billion for health care, equipment schools, and other needs.

Diplomacy:
$1.1 billion, including $324 million to evacuate Americans and diplomats overseas; $350 million to help refugees; $258 million in international disaster aid; $88 million for the Peace Corps to evacuate its volunteers abroad.

Elections:
$400 million to help states prepare for 2020 elections with steps including an expanded vote by mail, additional polling locations.

Arts:
$150 million for federal grants to state and local arts and humanities programs; $75 million for Corporation for Public Broadcasting; $25 million for Washington, D.C., Kennedy Center for the Performing Arts.

Congress:
$93 million, including $25 million for the House and $10 million for the smaller Senate for teleworking and other costs; $25 million for cleaning the Capitol and congressional office buildings.

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