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On January 29th CapitalLand (CLLDY), one of Asia’s largest real estate firms, announced their precautionary measures and business continuity plans to curb the spread of COVID-19. Now, real estate firms around the world are updating their 2020 guidance with warnings ranging from a “temporary halt in development activities” to “...not seeing any level of distress or any concerns about tenants' ability to pay rent”.
Are some real estate companies downplaying the impact of COVID-19? If there is a recession, as many economists are saying, will the dominoes within real estate begin to fall for consumer and commercial real estate firms? We’ve compiled all relevant commentary from the real estate companies so you can make your own analysis.
- Retailers with stores in China are slowly opening their stores there, but do not expect sales to return to normal levels until June possibly
- Jumbo mortgages are still being issued by big banks like Wells Fargo and they now require 20% down, but many lenders have stopped originating FHA loans because of concerns related to repayment
- Real estate companies are providing temporary rental subsidies for retail clients and consumers as both customers are adversely affected by the economic slowdown
Here are the highlights. [Note: We are updating this post and our compilation post to reflect the most recent commentary. Last updated 3/19.]
Spirit Realty Capital Q1 Earnings Call (4/13)
As the COVID-19 pandemic began to unfold, we took the important step to further strengthen our liquidity position by raising an additional $300 million of term loan proceeds at a very attractive borrowing cost. Bringing our total liquidity in excess of $830 million. Our strong liquidity position gives us the ability to repay debt that matures in 2021, assist our tenants in working through these challenging times and notably to be opportunistic when attractive acquisitions present themselves...In a COVID-19 world, some industries are doing well, and some are being hit really hard. The most resilient industries in our portfolio include grocery, drug stores, convenience stores, professional services, warehouse stores, logistics and distribution, office supplies, pet supplies, dollar stores and home improvement. The most challenged industries in our portfolio are movie theaters, gyms, entertainment and casual dining
American Homes 4 Rent PR (4/13)
COVID-19 and associated social distancing measures are impacting the economic well-being of many American families, and AMH is committed to helping its residents. The Company has waived late fees and halted evictions for nonpayment of rent for the month of April. The Company is also offering zero percent increases on renewal leases signed in April and is extending month-to-month renewal options.
Aeon Mall Co Full Year Earnings Call (4/10)
I will talk about the impact of COVID-19 on our sales. In China, by capturing Lunar New Year demand in January, in a new fiscal year, sales made a good start, showing the similar trend and better fiscal year 2019. However, on January 23, we closed specialty store zones of 3 malls in Wuhan due to quarantine of Wuhan City. In the middle of February, 11 malls were closed out of 21 malls in China. Even in malls, which continued operation, sales dropped sharply as moves to refrain from going out, enhanced partly due to administrative guidance...Late in February, we reopened malls in succession. The 3 malls in Wuhan were reopened on April 1. At present, all malls are reopened. Looking at recent numbers. Preoutbreak trends have not come back fully yet. In China, which was the first to experience an outbreak, infection already peaks out. We expect conditions will return to normal, by and large, around June and expect a recovery to pre-outbreak growth trends within the fiscal year. In ASEAN, with spread of COVID-19, 4 malls in Vietnam have been closed since March 28, and 2 malls in Indonesia have been closed since March 31. In Japan, after the government made a request to voluntarily refrain from holding large-scale events and close elementary and junior high schools late in February, customer traffic and sales started to drop and have been around 60% to 70% of the previous fiscal year. As we announced in our press release the other day, we decided rent reductions for tenants for March and April. Due to sudden changes in business environment and various restrictions on business activities, business results of tenants are down. Tenants are struggling with financing and continuation of business. In light of their situation, employment in regions and others, we took this measure. Specifically, our contracts with small and medium-sized tenants are on a percentage of sales rent basis. In a contract, a guaranteed minimum rent is set, we decided to remove that. There is no contractual obligation to reduce rents. However, as tenants are important partners for us, we decided to take this measure as a support measure to overcome these difficult conditions together with them.
Redfin 8K (4/09)
Camden Property Trust PR (4/02)
Camden Property Trust (NYSE:CPT) (the “Company”) announced today it has established a $5 million Resident Relief Fund for Camden residents experiencing financial losses caused by the COVID-19 pandemic. “While the full impact of COVID-19 on our country is still unknown, we want to assist residents experiencing hardship as a result of the COVID-19 pandemic and social distancing mandates,” said Richard J. Campo, Camden’s Chairman and Chief Executive Officer.
Regency Centers PR (3/30)
The Company has approximately $350 million of development and redevelopment projects currently in process and in various stages of construction. Approximately $225 million remains to be spent to complete these in-process projects. Due to impacts of COVID-19, construction has been suspended at some projects due to municipal orders, or has slowed substantially due to health concerns and labor limitations. Regency is assessing the impact of these project delays and will provide additional updates with its First Quarter 2020 earnings results.The Company is also closely assessing all pipeline development and redevelopment projects as well as non-essential capital expenditures.
Mid-America Apartment Communities PR (3/24)
We expect first quarter 2020 results to be in-line with our previously announced guidance. Year to date through March 24, 2020, average daily physical occupancy for our same store portfolio is solid at 95.7%. Our balance sheet remains very strong, with low leverage, significant capacity from undrawn committed credit facilities, and limited near-term debt maturities and funding obligations. However, as we face uncertainty regarding the economic effects of the pandemic, we are withdrawing our full year 2020 guidance and will update our expectations when we report our first quarter 2020 results on April 29, 2020
Omega Healthcare Investors PR (3/23)
Omega Healthcare Investors, Inc. (NYSE:OHI) announced today a number of precautionary actions in response to the market dislocation caused by the continued spread of COVID-19, including authorization of a stock repurchase program, suspension of the Company’s Dividend Reinvestment and Stock Purchase Plan, and a partial draw on the Company’s credit facility.
Welltower PR (3/23)
To further bolster near-term liquidity, Welltower today announced that it has successfully obtained a two-year unsecured term loan ("Term Loan") of $1.0 billion bearing interest at a rate of 30-day LIBOR +1.20%, based on the company's credit rating..."While we maintain unwavering confidence in our balance sheet, we believe it is prudent to take further steps to enhance our liquidity profile given current capital market conditions and the uncertain impact of the COVID-19 pandemic".
Simon Property Group PR (3/18)
Simon, announced that after extensive discussions with federal, state and local officials and in recognition of the need to address the spread of COVID-19, Simon will close all of its retail properties, including Malls, Premium Outlets and Mills in the U.S. This measure will take effect from 7 pm local time today and will end on March 29.
"The health and safety of our shoppers, retailers and employees is of paramount importance and we are taking this step to help reduce the spread of COVID-19 in our communities," said David Simon, Chairman, Chief Executive Officer and President of Simon.
Welltower PR (3/17)
We maintain that the population of frail and/or memory impaired seniors are best served in safe, controlled environments that have time tested protocols in disease mitigation in place. It is imperative that this population's daily needs for nutrition, hydration, medication management and other necessary activities of daily living be met, especially at this time where conventional home settings have neither the infrastructure, protocols nor staff to appropriately care for these seniors. If we cannot maintain these social determinants of health for this at-risk population, they will wind up in acute care hospitals which, given hospitals' increasing need to focus capacity on testing and treating COVID-19, is simply not an option.
I strongly believe that Welltower is well positioned to help address this crisis as we provide the necessary support to our operators and health systems to meet the needs of their populations. We are also actively looking for capacity across our portfolio to enable more off-site COVID-19 testing and other assets that can offer effective quarantine for those exposed to this virus.
While this can change at any moment, we have seen senior housing occupancy levels remain stable over the last four weeks. Occupancy of our 579 senior housing operating buildings (SHOP) over that time frame remained at an average of 85.7%, with a range of 85.6% to 85.8%. Specifically, in the Seattle MSA, our portfolio remained stable with an average weekly occupancy of 83.9%, with a range from 83.8% to 84.0% over last four weeks.
As of March 16, we have two residents with reported positive tests for COVID-19 in the US. Elevated protocols were put in place as early as late January which, if we look at our Seattle area assets, tells us they are helping to mitigate the spread of the virus and protect our resident base. While elevated protocols in the communities might mean a slower new resident flow in the short term, we have also seen a commensurate decline in voluntary move outs and higher lead-to-closing ratios. Our highest priority has been and will continue to be the safety of our residents and employees.
Unibail Rodamco Westfield PR (3/16)
At this date, local authorities have required all non-essential stores to close in France, Spain, Poland, Austria, the CzechRepublic and Slovakia. As such, the Group’s shopping centre in these markets are substantially closed (supermarkets,food stores, and pharmacies are typically allowed to open). Some limitations to trading hours also apply in Denmark. TheGroup’s other shopping centres continue to trade as normal for now, albeit with reduced footfall, although URW expects other governments may adopt similar measures in due course. The Group’s Convention & Exhibition businesses are also seeing an impact, with the French government currently restricting any events of more than 100 people.
Swire Properties Annual Report (3/12)
COVID-19 is adversely affecting our retail investment properties and our hotel business inHong Kong and Mainland China. Lower rental income is expected from the retail properties and serviced apartments in 2020.Temporary rental subsidies are being provided to retail tenants on a case by case basis.Occupancy and revenue are significantly down at our hotels. Costs will be saved where this can be done without damaging the long-term relationship with tenants and other customers.
COVID-19 is adversely affecting our hotel business in Hong Kong and Mainland China.Occupancy and revenue are significantly down at our hotels.Costs will be saved where this can be done without damaging the long-term relationship with our customers.A non-managed hotel (The Silveri Hong Kong- MGallery) which is part of the Tung Chung Town Lot No. 11 development in Hong Kong is expected to open later in the first half of 2020
Hong Kong Land Holdings PR (3/5)
The Group's performance to date in 2020 has been affected by the COVID-19 outbreak, which has resulted in a temporary halt in development activities in the Chinese mainland and lower turnover at its retail properties, including the LANDMARK in Hong Kong. It remains too early to quantify the impact of COVID-19 and the current social unrest in Hong Kong, although the Group remains confident in the long-term outlook of the markets in which it operates.
In the Development Properties business, contributions from the Chinese mainland are expected to be lower due to delays in sales completions as a result of the COVID-19 outbreak, while contributions from Southeast Asia are expected to be broadly stable. Higher financing costs are anticipated in 2020 due to land acquisitions.
Vonovia Q4 2019 Earnings Call (3/5)
Before we get to the Q&A, let me quickly summarize the main points on Page 22. But allow me to do a side step -- and will allow me to do a side step on very -- on one very specific topic of this day. We have all seen the speed of which the coronavirus has been spreading, and the consequences we are all reaching. And while we believe it is important not to overreact or even panic in this situation, it is equally important to act carefully and responsibly. As an employer of more than 10,000 people, we have -- we take the potential scare very serious. We are in contact with the authorities to be sure we react appropriate, if there is a need. We have taken the necessary precautions to make sure that our employees are as safe as they can be. We have not seen any infections among our workforce, and we are doing everything we can to make sure that this stays that way.
From the business point of view, I would like to say the obvious. We are not impacted by the coronavirus. We -- there are no meaningful supply chains that can be disrupted. There is no production facility that could be closed down and cause a revenue problem. And most important, there is no risk that demand for our product is going down.
It is no surprise when markets undergo a correction that individual stocks will find it's almost impossible to escape. But if you stop and think about the actual impact of the coronavirus on our business, you will quickly see that there isn't really an impact -- each of our 4 segments continue to perform strongly, and we are confident, not only with regards of 2020 guidance, but also on the longer term.
Healthpeak Properties Citi Global Property Conference (3/3)
Answer – Michael Bilerman: Tom, COVID-19 has got different impacts, different pieces of your business, right? It demonstrates, COVID-19 coronavirus is certainly...
Answer – Thomas M. Herzog: Yes.
Answer – Michael Bilerman: From a life science perspective demonstrates that we need tenants that will develop drugs to combat the number of diseases that are around the world. Two, your medical office building portfolio. In some cases, people don't want to go to a hospital where they can get infected, medical office maybe where they can get treatment. Whether your senior housing, should us get into one of those facilities clearly could have damaging event on a single asset or geography? So I guess, how do you -- how are you protecting yourself and how do you sort of see it playing out for the company?
Answer – Thomas M. Herzog: Well, one of the things I would mention first is, it is certainly a serious matter. Within our 34% -- I'll just speak to it from a business perspective and then we get to the real question. Our company constitutes, as I said earlier, 34% senior housing. Of that, about 15% is SHOP, about 7% to 8% is triple-net, and 12% is CCRCs. That should add up to about 34%. The CCRCs are probably not affected as greatly Because the average turnover is about 12% per year. The triple-nets, we just redid all of our triple-nets. We only have 3 major relationships remaining and the coverages are good. Within the SHOP though, of course, from a business risk perspective, is something we have to keep an eye on, much more importantly, though, is the human element to it. And our operators, which we've been in touch with routinely on a daily basis, in fact, are implementing their normal protocols. A lot of it's dictated by CDC requirements and the like. There's been added vigilance and communication; monitoring on a daily basis by the senior executives; setting up command centers; designating special teams to deal with the crisis, increasing oral and written communications for residents and employees who have focus on hygiene, contact, protocols; confirming with vendors that we're able to get the supplies that we need, in particular, around pharmaceutical and medical supplies; ordering extra supplies; developing staffing contingencies, if there's lockdowns or there's an issue where an employee becomes ill; extra training; resident intake protocols, if somebody's been traveling abroad...
Digital Realty Trust Citi Global Property Conference (3/3)
Question – Michael Rollins: And one question that we've been asking in the sessions today is just how you see the potential impact related to the coronavirus, both to your company and operations as well as how it might affect your customers and their business dealings with you?
Answer – Andrew P. Power: One, we obviously take it very seriously, and we're still in very, very early days. Maybe I can talk to the customer side and supply chain side. On the customer side, I would say, to date, we've seen limited impact. We've been doing business very recently with customers into APAC and out of APAC. We are obviously big believers in a virtual world. It's driving through our data centers every day, and business is getting done in a virtual format in many fronts. That being said, we have no idea where this current scenario goes, and there's always a potential impact to business. My glass half-full on that is the breadth of our customer base, 2,000 today, going to close to 4,000 with our combination or depth of relationship, both personally and contractually. With some of these top buyers, allows for easy repeat buying and allows us to keep continuing to support their business in the event that they don't have the physical ability to go to a new location as they've seen most of our sites. They know our capability. We're on board as a vendor with them. From a supply chain standpoint, we are -- obviously have the potential risk of impact given numerous components within our 4 walls. Could be manufactured or imported for some of the countries impacted. From our advanced discussions that well predate today where we are on this coronavirus. We feel that we look -- appear to be insulated, whether it pertains to batteries, UPS, switchgear, for at least 12 months' worth of time. So, so far so good. But again, as I mentioned in the opening statements, we don't know where this is going. We take it very seriously. And lastly, and I probably should put this front. From a people front at Digital, we are relatively small in the people front. Today, only 1,500 employees, but we are very international. So we've taken steps to shut down all travel into and out of APAC. That happened several days ago, and we'll obviously evaluate this step-by-step as things need to be evaluated for other international parts of the world.
UDR Citi Global Property Conference (3/3)
Question – Nicholas Gregory Joseph: Great. Thank you. We're also opening with this question. In terms of coronavirus, obviously, there's a lot of unknowns. But what is UDR doing both from an on-the-ground perspective as well as from a corporate perspective to be as prepared as you possibly can be for it?
Answer – Thomas W. Toomey: Well, certainly, as this arose, what we first did is desked off our prior plans with respect to pandemics and the implications thereof. And we've had no impact to date with respect to residents or the workforce or any knowledge to our operations. But what I can say is, is our general business approach is twofold. One, accommodate. Rather, that's our associates, from working at home, if they have to care for ill ones, or they are ill themself, giving them the accommodation necessary, and we extend the same courtesy in respect to our residents with respect to their ability to function or provide shelter for them. We'd expand beyond that in the accommodation aspect that we reviewed our preparedness plans in detail. And what we found is, over the last 10 years, we've made great progress with respect to technology penetrations and that our residents by today, 90-plus percent can pay their bills, be serviced by us. And that our workforce can work from home as well. So I think we're prepared for a short disruption and feel good about our position on this. We just hope it doesn't come to fruition.
Alexandra Real Estate Equities Citi Global Property Conference (3/3)
I'll go ahead and start with the 3 reasons you should buy our stock. I think the coronavirus is a great reminder of the value of the life science industry and the many challenges to human health that exist today and that will appear in the future. We're still at the very early stages of the biology revolution. And what is going on today really underscores the importance of this. And we're in the best position or Alexandra is in the best position today to benefit from the demand for space that is going to come from problems such as the coronavirus and other things that will come in the future and obviously, things like cancer and Alzheimer's disease and whatnot. There's certainly a number of things that need to be done, and we're best positioned as anybody to solve that.
We're also a better alternative to many real estate sectors. We have a strong underlying industry that's propagating demand. We have a low CapEx profile. We have a lack of exposure to WeWork. We so far have not experienced any densification trends that would be tough for our business. And we have some of the best located real estate in the centers of the knowledge economy, which is really where everything is going. The markets that we're in are the leading edge markets for this stuff, and we have the best locations for those companies.
WP Carey Citi Global Property Conference (3/3)
Question – Emmanuel Korchman: Have the, whether it be coronavirus or sort of the other concerns or threats on the economic growth, been of concern to your tenants recently, especially since you're more on the industrial side of industrial rather than the warehouse side of industrial?
Answer – Jason E. Fox: Yes. I mean it's early to see how that flows through our tenant base right now. We have not seen any level of distress or any concerns about tenants' ability to pay rent. Clearly, it looks like it's going to impact consumer confidence. It's almost impacting supply chains, especially those that go through China and other affected areas. I think what's important to note is that within the broader real estate sector, I think net lease is viewed more as a safe haven asset given the duration of the leases and the focus on credit underwriting. I think within the net lease peer set, I would expect us to outperform in a down economy or a downside scenario. Again, we have close to 11 years as a weighted average lease term. More importantly, our focus on underwriting and on managing our portfolio is acquiring operationally critical real estate, and in many cases on master leases, which adds another degree of downside protection. We've seen that through past cycles. In fact, if anything, I think, given our business model, our flexible balance sheet, any kind of dislocation could create a buying opportunity for us to the extent our cost of capital maintains the current strength that it has now.
Duke Reality Corp Citi Global Property Conference (3/3)
Now let's talk a little bit about the coronavirus and the full impact. I don't think any of us know clearly what the impact is. At this point, it would appear that there will be short-term disruptions in the supply chain of raw materials and finished goods. And I'll reiterate short term. We spent a lot of time in the last 10 days talking to our clients. And they are anticipating short-term disruptions, 30 to 90 days. Depending on who they are and what their products are will ultimately determine what that impact is, but every one of our clients have said this has not changed their long-term real estate strategy. They are going to continue to move ahead with leases and build-to-suits acquisitions in 2020 and 2021. And just to reiterate: We signed leases last week with major clients across the country. So while it's making clearly a lot of headlines and it has a lot of us nervous, most of our clients say it's business as usual working forward.
So we believe, in spite of this short-term situation, hopefully, it's a short-term situation, the macro economy is on solid footing. Supply and demand remains in balance, and we're confident that we're going to be able to continue to drive good cash flow growth and to continue to raise our dividend.
Equinix Citi Global Property Conference (3/2)
Question – Michael Rollins: Can you address what are the implications for Equinix and what's happening with the Coronavirus in terms of the impacts to Equinix as well as potentially what you're hearing from your customers?
Answer – Charles J. Meyers: Sure. Let me sort of talk across the gamut of corona-related topics. And first and foremost, is employee health and well-being. We are, as we always are, very focused on that and ensuring that our employees and our customers are cared for. So we have taken a posture that I would call sort of in line to slightly ahead of CDC and who and other sort of key authorities. We announced this week that we will take restrictions in terms of travel restrictions into and out of China, Japan, Korea and Italy. And then we took the further step to augment that to restrict intercontinental travel to large group meetings. And any other intercontinental travel is subject to VP level approval. So we feel like that's a balanced assessment of the current risks and the current facts. So we kind of have adopted the facts, not fear approach that the CDC is recommending. At the same time, we want to make sure -- but -- and in all of that, the one thing we also are making clear is that our employees, at all times, are free to make decisions to travel or not to travel at the -- strictly their own discretion. And if there are circumstances or their own health situation dictates that they elect not to travel, then we support that decision. So that's the health and well-being of our employees.
As it relates to operational items, we, obviously, have data centers in impacted areas. We have -- we've implemented our business continuity team to actually enact operational continuity policies and procedures in those areas, and we haven't had any issues. We're providing all the resources and materials and provisions, et cetera, for our teams to care for our facilities around the clock. Our office employees are in a work-from-home situation. But obviously, in the data centers, you really can't do it that way. So we've been very happy with how they responded.
Then the third category would be customers. We have not seen a -- any blowback or cause for concern or reluctance from our customers saying, "Hey, we're going to wait and see. I know we were talking about doing something, but we're not going to do it." We have not seen that. Right now, digital transformation, we believe under any economic scenario and despite any other sort of reverberations in the market that occur for whatever reason, we think is a top priority for our customers and for their Boards. And so we see them in a full-steam-ahead kind of mode.
And then the last area, I think, of corona-related questions is supply chain. Today, we don't -- we do not yet see any impacts in that area. The RFS, Ready For Service dates of the projects that we have on our expansion sheet remain intact. And we think, at least, those that are in the near term horizon, have the equipment available to get those up and running on time and on schedule. And we're continuing to watch it. We do think that we're -- we kind of are well positioned to get favorable treatment in terms of as alternative sources of supply are enacted, et cetera, and we feel good about that. But all in all, we aren't yet seeing anything, but we'll monitor it closely
Equity Residential Citi Global Property Conference (3/2)
Question – Nicholas Gregory Joseph: Maybe just to start, and I recognize it's kind of a constantly evolving situation, but how's EQR handling kind of the coronavirus concerns, both as a corporation and also at a property level?
Answer – Mark J. Parrell: Yes. So at this point, there's been no impact on the company whatsoever from the virus. We're obviously closely monitoring the situation as all of the folks in this room are, certainly not an epidemiologist. Don't know what is actually going to happen here, but we have reinforced with our on-site personnel and with our people and our corporate offices, the importance of good hygiene, all the things that I think we know is common sense: dispensing with handshakes for the time being, washing our hands more frequently, all of those things.
It was funny, about a month ago, we started talking -- I started talking with our field operators about what we might do as coronavirus began to be a bigger issue. And it was very interesting, they just pulled out of their hands and said, "Well, we have our pandemic response materials already ready because our team is very tenured." A lot of the people have been there a long time and are very experienced. So when SARS went through the world, we developed a series of procedures for that, and we called it our pandemic response procedures, and they're in all our books, in all 300 of our properties and all our property people were reminded of that. And on Wednesday, every Wednesday, we have a video session that runs out of Chicago where we close all our properties down for about an hour and we talk about current issues. Sometimes, those are business issues like leasing. In this case, it's going to be, again, about hygiene, cleaning common surfaces. What to do if the CDC or some other health office speaks to you about something going on in your property. So we feel on-site as prepared as we can be. And as I said, a lot of our senior operators, frankly, have been through variance of this before.
Weyerhaeuser Co Raymond James Institutional Conference (3/2)
Question – Collin Philip Mings: Okay. Now we think about some of the domestic strength, if you will, with housing and some of the activity in repair and remodel, but maybe just update us as it relates to the timber business, and what you're seeing from the coronavirus in terms of log exports? You have a slide on there that goes through some of the exposure between Japan, China, Korea, maybe just talk a little bit more through how exposed are you to the export market? And what are you currently seeing? I mean, given some of the challenges with the labor force, particularly at the mills in China? Are you still sending logs over there? Same thing with Japan, that's obviously a higher-margin business for Weyerhaeuser, historically, what are you seeing in that?
Answer – Devin W. Stockfish: Right. Yes, with the export market, I think it's important just for context to remember that 7% of our revenues are to the export market, and the vast majority of that is to the Japan market. And so our China business, in particular, is a relatively small piece of our business. And so really, for us, that moves the needle really only around the margins. And so in the Pacific Northwest, frankly, we had already seen a little bit of a slowdown in the China market related to the European salvage volume that was coming into that market. So we had dialed back our China exports already even before the coronavirus. Certainly, I think the activity in China has slowed. I don't think that's a secret. And so I think that will be choppy for a little while. But again, the rationale behind having a diverse mix of customers is that we have opportunities to flex that volume. And so we had already started doing that in flexing some of that China volume back to the domestic market for higher-margin opportunities.
In Japan, to date, we really haven't seen any impact from the coronavirus. We continue to have solid order files from our Japanese customers. Obviously, it's a dynamic situation. So we'll continue to watch that, but to date, we haven't seen any real impact there.
Host Hotels & Resorts PR (3/2)
Host Hotels & Resorts, Inc. (NYSE: HST), the nation's largest lodging real estate investment trust (the "Company"), today announced that, to date, Coronavirus (COVID-19) has negatively impacted its total revenues by approximately $14 million, net income by approximately $7 million and adjusted EBITDA by approximately $7 million, which amounts to a decrease of 0.5% at the mid-point of the Company’s 2020 adjusted EBITDA guidance range of $1,360 to $1,405 million.
American Tower Corp Citi Global Property Conference (3/2)
Answer -- Michael Rollins: So I'd say on a short-term basis, we collect lease payments every month on our sites. That's 95%-plus of our revenue line.
Question – Michael Bilerman: And the good news is nobody is going to your site so you have no human contact?
Answer – James D. Taiclet: That's right.
Question – Michael Bilerman: At your properties?
Answer – James D. Taiclet: That's right. These sites run autonomously, actually, and the leases are paid electronically through means of not having to either collect cash in a storefront or checks or anything like that. So the short-term impact of the coronavirus on our business should be de minimis. The long-term impact should be, I would imagine, neutral to positive depending on how this goes because mobile connectivity could get more important if people want to gather less or congregate less in offices or conferences or whatever it may be.
Essex Property Citi Global Property Conference (3/2)
So -- and then maybe -- and to some extent of that, we should comment on coronavirus and COVID-19, a couple of comments there. First, we haven't seen any impact at this point in time in our leasing operations. I guess, second, it's too early to tell whether there will be an impact to job growth this year. And obviously, job growth drives demand for apartments and housing in general. And so it's key to our rent growth expectations. Three, the counties of San Francisco, Santa Clara, Orange and San Diego have declared a state of emergency, and that automatically triggers some rent caps at 10%. L.A. and Ventura counties already had a state of emergency declared because of the wildfires last year. So unless things continue to deteriorate significantly, I would expect us to have a very small impact on our outlook for 2020.
Simon Property Group Raymond James Institutional Investors Conference (3/2)
Question – Collin Philip Mings: And just to repeat it for the webcast, we got a question was just on, in particular, Asia, given Simon's presence over there, any sort of update related to the virus. And I would just piggyback on that, just anything even domestically. So just a broader update on coronavirus.
Answer – Brian J. McDade: Sure. Look, it's obviously unfolding real time. We have not seen in our assets in Asia any material change. We do not -- until we close on the transaction for Taubman, we'll not have any direct exposure to China. Our assets are outside of China. And so we've actually seen a pretty steady state. Now obviously, the last 2 weeks have changed the dynamic a little bit, and the escalation of at least the narrative is changing. So that could ultimately evolve over the course of the next few weeks, and I'm sure it will, but we've not seen any material impact to the business.
Camden Property Trust Citi Global Property Conference (3/2)
We have not. We have not seen any changes in patterns or people coming into our properties or web traffic or what have you. We have looked at and tried to sort of think through forward what happens in a corona environment -- in corona, sort of virus maybe induced recession or a slowdown in the economy.
And there are probably 2 periods in time that were interesting in the sense that -- so if you think about a normal kind of recession, recessions are sort of different than sort of event-induced recessions.
Let's take 9/11 as an example, and also the financial crisis as an example. One of the things, I think, was instructed by those 2 recessions and the -- was that, people sort of sheltered in place, if you will. It's kind of an interesting concept, given corona. And the turnover rates dropped dramatically. Even though demand went down, we had fewer people moving out to buy homes and fewer people moving out generally. Now demand did go down and people had to consolidate. So people who couldn't afford their apartment because they lost their jobs or what have you, move back with their parents or they consolidated within the community, a 1 -- two 1 bedrooms became 1 2-bedroom, and we had vacancy in our in 1 bedroom. So it's likely to -- the corona-induced slowdown is likely to create more, sort of shelter in place as long as people have jobs. They aren't going to move around as much, and that should keep turnover down. The question will be, how much demand is destroyed? And what happens to jobs, overall, if there is a kind of corona-impacted recession.
Mid-America Apartment Communities Citi Global Property Conference (3/2)
Well, there are a lot of things that we're doing internally in terms of just communications with our employees as well as communications with our residents about things and actions that people should be taking in an effort to mitigate the risk of infection, if you will. And beyond that, we are spending some time scenario planning and thinking about the potential surrounding a given property or a given department, if you will, at the home office and the corporate office, being forced to keep a number of employees home for some reason as a consequence of, particularly, hypothetically, one person being infected and the whole group of people associated with them, likewise, having to be quarantined. So we're doing some planning as it relates to that sort of thing. In terms of making sure that we, as a company and we as a business, are in a position to continue to operate and execute the services that our residents are planning on for us. So we've got that underway. Beyond that, I think kind of a secondary question surrounds what are the implications surrounding a more widespread slowdown with the economy in general and how does that play out as it relates to our business. And again, we've been through recessions before as a company. And we've operated very well through those periods of time. But largely, we tend to see in these kind of environments where resident turnover begins to slow down a little bit, resident retention picks up, which is frankly one of the better rent growth areas of our company. So we think that there are some positives. In that sense, I do think that you might very well see new lease activity start to slow a little bit potentially if the broader economy were to slow down. So there's give and take, both, but we're spending a lot of time thinking about that right now and planning for it.
Welltower Citi Global Property Conference (3/2)
I'd also say you have to remember the people that live in senior housing today, generally, have 3 or more chronic health conditions. These are people -- that the idea that because there's a flu outbreak, they can stay at home and be cared for at home, I think, is a bit misguided. If you're very wealthy, you might be able to do that. But for many people, they need to be in a controlled environment where the -- their social determinants of health, things like nutrition and things like safety and Medicaid management need to be monitored. For most of the senior population, they cannot do that. So I would -- I'd like to think that this will make outbreaks like coronavirus actually support the senior housing business. You need to make sure that you have the highest standards in place. And that is something that I can't speak to. What I can speak to is the standards we have in our portfolio. The other point I'd make about the medical office is, I would say most people do not want to set foot in a hospital during these types of situations. On a regular day, the amount of infection that you expose yourself to by just stepping into an emergency room or even the lobby of a hospital building is significant. So looking to sites of care outside of the hospital become even more compelling.
I think the main point of our comments on coronavirus here that it is not to try to predict what's going to happen next because I think if you look at the markets, particularly, all of last week and this morning, I think it's -- a lot of it is anybody's guess, but it's just to make the point that whether it's the coronavirus or the flu -- and obviously, coronavirus is a much more significant -- so far, what we know of it, more significant disease. This isn't -- senior housing operators didn't wake up last week just starting to think about this. I think a lot of the economy is -- this isn't part of their normal business, for obvious reasons. People don't die of it on an annual basis within where they operate, but it is something that is constantly part of this business. So there's protocols in place that, we think, mitigate some of the risk, but we're certainly not trying to guess at what the impact is and not trying to think of what happens if A, B and C occurs. We are thinking about it, but not trying to quantify it. I think that's more of the job of those in this room that are trying to buy and sell stocks off of it, but we're just trying to operate a business around and maybe kind of mitigate that risk.
New World Development Company Interim Results (2/28)
It is expected that the operating performance of hotels in Hong Kong and Mainland China will continue to be affected by the outbreak of COVID-19 in the near term and will further weaken in 2020.
Sun Hung Kai Properties Q4 2019 Earnings Call (2/27)
In lieu of the prevailing COVID-19 epidemic outbreak, the group decided to grant rent concession to adversely affected tenants in February, particularly F&B operator helping to ease pressure on retailers while maintaining employment in the weakening economic environment.
In terms of contract sales, around RMB 3.3 billion was achieved during the period. The table here shows the breakdown of individual projects. The table in this slide shows the major new launches on the mainland in the next 10 months, including brand-new residential apartments in Suzhou ICC. And due to traffic flow control measures result from the COVID-19 outbreak, home sales activities has been severely disrupted recently. We believe the sales in these activities will be resumed when the outbreak is under control. And that's all for the group's property business, and I'll go through the hotel business performance in the next slide.
Let's cover our business update, and let me talk about the market prospect. In Hong Kong, the outbreak of COVID-19 add significant downside risk to the local economy in the short term. However, the operating environment is expected to be back on track when the epidemic is contained. For the primary residential market, activity will stay low in the near term despite solid end-user demand. Nevertheless, relatively low mortgage rates and steady new supply over the next few years will cushion the downside risk.
Capitaland Full Year Earnings Call (2/26)
People are starting to go to the malls because psychologically, people feel so pent up. They actually prefer when you allow them to go out from their house, actually, people want to go to the parks, people want to go and spend time to shop, to live life again. Because human beings, at the very core, we are social creatures. I mean just imagine we've got colleagues who -- when they go back to China now, especially in Shanghai and Beijing, they are to spend 14 days self-quarantine in their apartment. So when I speak to many of them on quite a regular basis, they say that it's -- for those who have started to go back to work, they say like, it's like freedom from jail. So they never appreciate that kind of time that they have to go to the malls to appreciate life, to appreciate crowd. So fundamentally, I feel that in Singapore and China, the business recovery, the activity will go back to life a lot faster than most other places. But for China, maybe I give -- ask Lucas to give a bit more color, and then Jason. And then I'd give -- ask Kevin to share more in the lodging side
Capitaland Full Year Earnings Statement (2/25)
The spread of the novel coronavirus (COVID-19) in China and beyond has created a high level of uncertainty to the near-term global economic prospects. Many economists have predicted a GDP slowdown for China for the first half of 2020, followed by a rebound thereafter, should the virus be contained within three to six months. A weakened China economy will impact Southeast Asia, including Singapore, with the hospitality, F&B and retail sectors amongst the most impacted.The Group is taking precautionary measures in accordance with guidelines provided by the respective authorities.
In China, in the virus epicentre of Wuhan, CapitaLand has closed four malls under the directive of the local authority. Some other malls in China have also been temporarily closed or are operating on shorter hours. We have temporarily stopped offering most of our short-stay options at our serviced residences,and are extending assistance to our long-stay guests.
In Singapore, we have experienced lower foot traffic to our shopping malls and reduced serviced residence bookings, due to higher caution adopted by shoppers, and lower visitor arrivals. COVID-19 will therefore have an adverse impact on our operations and trading results, the extent of which will depend on how long the outbreak lasts.We remain positive on the long-term fundamentals for Singapore and China. Our current priority is to ensure the well-being of our staff, tenants and patrons. We will proactively manage our business and take the necessary actions to ensure that our long-term business prospects going forward remain robust.
Our capital recycling in 2019 resulted in a net release of S$2.8 billion back to the Group, thereby enhancing our financial strength and resilience. We are thus well-positioned to further support our operations should the impact from COVID-19 be prolonged. Importantly, we are also in a good position to selectively pursue opportunities that may arise to further strategically grow our business
Host Hotels & Resorts Form 10K (2/25)
2020 will prove a challenging year for the lodging industry due to a number of economic, political, and global issues. Consensus forecasts anticipate real GDP growth of 1.9%, implying slower economic momentum. Consumer confidence and labor markets remain strong, which have the potential to bolster the leisure travel segment. However, business investment growth, which historically has been highly correlated to RevPAR growth for upper-upscale properties in major markets, continues to decelerate. Additionally, the strong labor market will drive increases in wages and benefits that will challenge operators to maintain margins. These conflicting economic indicators, combined with election year uncertainty and continued trade instability, will weigh on growth potential in the lodging industry this year. In addition, the coronavirus outbreak in China and other countries is expected to have an economic and travel impact in the U.S., particularly for gateway cities such as New York and San Francisco, though the timing and severity of the effect is uncertain.
Capitaland PR (2/23)
CapitaLand has committed rental relief and S$10 million in marketing assistance to help its mall tenants in Singapore ride through current challenges and position for the future. As COVID-19 has impacted different malls and trade categories by varying degrees, the rental relief will be disbursed to tenants in a targeted manner. CapitaLand will offer various forms of support which may include flexible rental payments, and a one-time rental rebate of up to half-a-month for eligible tenants. In addition, to ease cashflows for all its mall tenants, CapitaLand will release one month security deposit to offset rental payments for the month of March 2020.
WP Carey Q4 Earnings Call (2/20)
Looking ahead, we expect the market environment to remain competitive in 2020 with central banks, both in the U.S. and Europe, signaling their intentions to keep rates low. Brexit has made some meaningful progress and fears of a trade war with China have eased somewhat. However, the impact of the coronavirus on global growth and supply chains has become an unknown.
Nippon Building Fund Full Year 2019 Earnings Call (2/18)
In closing, there are several risk factors in the global economy such as the impact of the coronavirus as well as the U.S.-China trade issue. And here in Japan, we are starting to see signs of a slowdown, mainly in the manufacturing sector.