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U.S. airlines carried 61% fewer passengers in November over the same month in 2019 as the coronavirus pandemic continues to discourage air travel, the Transportation Department said yesterday, Reuters reported. The decline was down slightly from the 62% decline in October. The largest 21 U.S. airlines carried 28.5 million passengers in November down from 72.8 million passengers in November 2019. It was the lowest monthly decline since April, when air travel fell to just 3 million passengers, down 96%.

The coronavirus pandemic has ravaged the hospitality, travel and retail industries since its outset in March, when shutdowns and restrictions meant to contain the virus cost more than 520,000 U.S. service workers their jobs. This workforce is under renewed pressure amid a resurgence in coronavirus cases: 498,000 leisure and hospitality jobs disappeared last month, the Labor Department reported Friday. Restaurant and bar workers comprised the bulk of those losses, roughly 3 in 4, an onslaught that disproportionately affected women and workers of color, the Washington Post reported. Overall employment in the sector has fallen 23 percent during the pandemic, outpacing every other industry, federal data shows. With new rounds of state-mandated restaurant and bar restrictions, and winter weather limiting outdoor dining, food services accounted for 372,000 job losses in December. That backslide obliterated significant hiring gains in industries like professional services, retail and construction, and the United States recorded a net loss of 140,000 jobs in December — its first negative showing since April.

Studio Movie Grill has filed its plan of reorganization, nearly three months after filing for chapter 11 protection in October due to effects of the Covid-19 pandemic, the Dallas Business Journal reported. If the bankruptcy court confirms the plan, the company will exit bankruptcy in less than five months, said Frank Wright, Studio Movie Grill's bankruptcy lawyer. While it is waiting on the court to set a date to confirm the plan, the Dallas-based dine-in movie theater chain is also running a sale process to see if an outside bidder is interested in acquiring the company, Studio Movie Grill said on Monday. The plan will provide for a creditors’ trust to manage liquidation of some assets to handle the company’s $50 million of contingent and non-contingent general unsecured debt. The bankruptcy process has forced eventual closure of about one-third of the company’s locations.

U.S. commercial landlords have granted billions of dollars of rent relief to struggling storefronts as property owners strive to keep falling occupancy rates from triggering more severe financial consequences, WSJ Pro Bankruptcy reported. With many commercial property tenants in dire financial straits due to the economic fallout from the coronavirus pandemic, landlords are reluctantly granting concessions on lease payments, lengthening payment terms, extending or shortening leases, lowering rents permanently and even forgiving past-due payments, according to real-estate advisers, property managers and lawyers. By providing the breaks following negotiations, landlords are hoping to avoid pandemic-induced tenant departures, keep properties occupied and rent payments flowing, while avoiding the larger losses that can come from evictions and increased vacancies in their shopping centers and malls. They are fearful of triggering lease provisions that kick in when key anchor retailers or a certain number of tenants leave a certain property, cutting rents for those that remain. Retail vacancies have been steadily on the rise and are expected to significantly increase. The average retail vacancy rate was around 4.5% going into the pandemic and estimated to end 2020 at 5.3% to 5.5% but is projected to increase to between 5.8% and 6.2% by the end of 2021, according to data from real-estate analytics company CoStar Group Inc. Before the pandemic, average retail rents were growing at more than 2% annually, according to CoStar. CoStar now expects rents to decline by anywhere from 1% to 3% year-over-year in 2021. A record-breaking number of major retailers — more than 60 — filed for bankruptcy in the U.S. in 2020. Major retailers announced plans to close more than 12,200 stores last year, according to CoStar. These closures will empty an estimated total of 159 million square feet of retail space, out of roughly 11 billion square feet available nationally, CoStar said. “What’s happening in the market is most definitely going to cause an overall devaluation of real estate across the country,” said Matthew Bordwin, principal and managing director at real-estate brokerage Keen-Summit Capital Partners LLC. Katharine Battaia Clark, a Dallas-based partner at law firm Thompson Coburn LLP, said on a panel during ABI's Winter Leadership Conference last month that she has seen “really aggressive negotiating tactics” being used by consultants hired on behalf of bankrupt tenants. The tenants’ position has been to “accept our terms or take a hike, we’ll reject your lease and then you’ll be an unsecured creditor and good luck to you, and you’ll have an empty space,” she said. Read more. 

Occupancy issues are at the heart of many significant retail cases, as detailed in the ABI publication Retail and Office Bankruptcy: Landlord/Tenant Rights, available at the ABI Store. 

The Paycheck Protection Program was a lifeline for millions of small businesses brutalized by the pandemic. Over a four-month span, the government program distributed $523 billion in forgivable loans to more than five million companies. The average recipient got just over $100,000. And then there were the roughly 300 business that received loans of $99 or less, the New York Times reported. Judith Less, who runs a thrift shop in New Jersey, got $27. Nikki Smith, a baker and caterer in Oregon, collected $96. A.J. Burton, the founder of a record label in Arkansas, got $78. And Susana Dommar, a chiropractor in Texas, received a loan for just $1. Stephanie Ackerman, a self-employed college admissions consultant, was shocked when her loan deposit, for $13, showed up in her bank account. “That’s supposed to help my business? It was a joke,” said Ackerman, whose company, Tomorrow Today College Consulting in Red Bank, N.J., lost months of sales last spring as the coronavirus crisis took hold. The tiny sums were equally frustrating for the banks and other lenders that made the government-backed loans. For each, they were paid 5 percent of the value — meaning they collected just pennies on the smallest loans, far less than they cost to make. Ms. Ackerman’s loan netted her lender, Bank of America, a fee of 65 cents, paid by the government.

Midwestern farm, home and outdoor retailer Stock+Field has filed for bankruptcy and plans to close all of its stores by March after 65 years in business, WSJ Pro Bankruptcy reported. Tea Olive I LLC, which does business as Stock+Field, filed for chapter 11 protection on Sunday in the U.S. Bankruptcy Court in St. Paul, Minn. after starting a store closing sale process that is projected to conclude at the end of March. “There have been many challenges in 2020, and Stock+Field was not immune to them,” Matthew F. Whebbe, the company’s chief executive and chairman, said in a post on the retailer’s website. Stock+Field, formerly known as Big R, has 25 stores across Illinois, Indiana, Ohio, Michigan and Wisconsin, as well as two warehouses in Illinois. The retailer changed its name from Big R to Stock+Field in July 2019. “We hope to reopen stores at some point in the future,” Mr. Whebbe said in the post. In court papers, the Eagan, Minn.-based company valued its assets and total debt between $50 million to $100 million. The company said it owes about $29.7 million to asset-based lender Second Avenue Capital Partners LLC and other creditors. The retailer is requesting to use cash collateral pledged to lenders to continue operations and store closing sales to maximize asset values, according to court documents filed yesterday.

About six months after opening its first store, Art Van successor Loves Furniture is filing for chapter 11 restructuring and liquidating 25 stores in hopes of surviving, WOODTV.com reported. In court documents filed Sunday, Loves interim CEO Mack Peters said Penske Logistics Services, the company’s warehouse manager, pulled its people and trucks from Loves’ warehouse in late January after the furniture retailer ran out of cash to pay Penske. Loves says Penske also refused to let Loves use its warehouse management system to find inventory in the 1-million-square-foot warehouse to fulfill customer orders. Penske took a step further on Jan. 6 by filing for a temporary restraining order against Loves to prevent the furniture retailer from moving or delivering items in its warehouse, according to the bankruptcy court filing. Loves says it canceled all customer orders that weren’t already pulled from the warehouse that the company leased directly.

Municipal bond issuance in 2020 was the highest in a decade, reflecting the collapse of interest rates and the increased costs cities and state governments are facing from COVID-19 shutdowns, the Wall Street Journal reported. Bonds for new projects reached $252 billion last year, according to Refinitiv, a small increase from the previous year. The new borrowing drove the total amount of outstanding muni debt above $3.9 trillion for the first time since 2013, according to the Federal Reserve data from the third quarter. The muni issuance boom is unlikely to abate as cash-strapped local governments struggle to make up for ongoing COVID-19–related shortfalls and pay back old debts. Before the pandemic, many city and state governments had already been operating on tight budgets. Despite the increase in availability of muni bonds, investor demand remains strong. Central bank rate cuts have left investors clamoring for yield. Muni bond investments produced steady returns last year in a low-interest rate environment.