Coronavirus (COVID-19)—implications for real estate finance transactions

The following Banking & Finance practice note provides comprehensive and up to date legal information covering:

  • Coronavirus (COVID-19)—implications for real estate finance transactions
  • Property values and valuations
  • Property inspections for valuations
  • Property values and loan to value
  • Rental income and cashflow in investment facilities
  • Requests for rent holidays and rent reductions
  • Non-payment of rent in commercial leases—protections for tenants
  • Rising use of CVAs by occupational tenants
  • Development facilities and construction delays
  • Residential real estate finance and pre-sales
  • More...

Coronavirus (COVID-19)—implications for real estate finance transactions

This Practice Note sets out the key issues which are relevant to real estate finance during the coronavirus (COVID-19) outbreak.

For information on the general issues arising from the coronavirus outbreak that are likely to be of interest to banking & finance lawyers in general, see Practice Note: Coronavirus (COVID-19) implications for Banking & Finance lawyers and, in particular Force Majeure, Execution of documents, Brexit, LIBOR, Regulation for banking lawyers, Restructuring and Corporate.

For information on general lending issues arising from the coronavirus outbreak, see Practice Notes: Coronavirus (COVID-19)—implications for lending transactions and Coronavirus (COVID-19)—Banking & Finance frequently asked questions.

The impact of coronavirus on the real estate finance (REF) market has gone to the heart of most transactions, affecting property values, rental cashflow and construction. Lenders and borrowers will need to review their finance documentation in detail to check for any provisions that might be affected by the pandemic. It will be important to do this regularly as different issues will arise as the transaction progresses, for example:

  1. new drawdowns: most facility agreements require the borrower to confirm that no default is continuing (or will be caused by) any new drawdowns. They will also require the borrower to repeat certain representations before the lender will make the loan. Future drawdowns may not be possible if the borrower cannot comply with

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