The United States Department of the Treasury has approved California’s plan to provide $1 billion in mortgage relief, clearing the way for the California Mortgage Relief Plan to provide help to as many as 40,000 struggling homeowners, according to a statement from Gov. Gavin Newsom’s office, the Sacramento Bee reported. “We are committed to supporting those hit hardest by the pandemic, and that includes homeowners who have fallen behind on their housing payments,” Newsom said in a statement. “No one should have to live in fear of losing the roof over their head, so we’re stepping up to support struggling homeowners to get them the resources they need to cover past due mortgage payments.” California already has provided renters and landlords with assistance, he noted. “Now, with our California Mortgage Relief Program, we are extending that relief to homeowners,” he said. The program will help homeowners make past due housing payments — to a maximum of $80,000 per household — by making a direct payment to the mortgage servicers.
Kansas officials continue working to speed up the distribution of aid money to help people avoid eviction, the Associated Press reported. More than 40% of the $169 million allocated to the state program has been given out so far, according to Ryan Vincent, executive director of the Kansas Housing Resources Corporation that is overseeing the aid program. Kansas, like most states, fell short of the federal goal of distributing at least 65% of the aid money by Nov. 15, according to the Topeka Capital-Journal. Federal reporting shows only 10 states and the District of Columbia met that target. But Vincent said Kansas has been making steady progress and roughly 32,000 Kansans have received help so far. The amount of aid money the state handed out has more than doubled since late August when it had given out just $31.9 million or about 17% of the total. And Kansas isn’t in danger of having the federal government reclaim some of the money because the state had distributed at least 30% of the aid by the November deadline.
The federal eviction ban, along with a mix of state and federal moratoriums, is credited with keeping millions of Americans in their homes during the pandemic and preventing the spread of the coronavirus. There was a brief lull in evictions after the ban ended in September. But housing advocates say that they’re on the rise in many parts of the country — though numbers remain below pre-pandemic levels due to the infusion of federal rental assistance and other pandemic-related assistance like expanded child tax credit payments that are also set to end, the Associated Press reported. Part of the increase is due to courts catching up on the backlog of eviction cases. But advocates say the upsurge also shows the limits of federal emergency rental assistance in places where distribution remains slow and tenant protections are weak. Rising housing prices in many markets also are playing a role. According to the latest data from the Eviction Lab at Princeton University, evictions have been rising in most of the 31 cities and six states where it collects data. Evictions in September increased 10.4% from August. October numbers were 38% above August levels and 25% higher than in September. Filings fell around 7% from October to November and now remain about 48% below pre-pandemic levels.
A Canadian court ordered Cineworld Group PLC to pay 1.29 billion Canadian dollars, equivalent to about $1 billion, in damages for walking away from a merger agreement with Cineplex Inc. after the COVID-19 pandemic rocked the movie-theater industry world-wide, WSJ Pro Bankruptcy reported. An Ontario judge rejected arguments by U.K.-based Cineworld that Canada-based Cineplex violated the terms of a planned merger between the two companies when it took steps to conserve cash by deferring payments to landlords, vendors and film studios after box offices shut down in the early days of COVID-19’s global spread. “Cineplex cannot be held in default…when it was prevented from conducting its normal day-to-day operations by government mandate,” said Justice Barbara Conway of the Ontario Superior Court of Justice in her ruling on Tuesday. Cineworld, which operates the Regal cinema chain in the U.S., said it would appeal the decision and “does not expect damages to be payable whilst any appeal is ongoing.” It reported about $450 million in cash holdings as of June and previously said it expected “no material liability” to arise from the Cineplex lawsuit. The U.K.-based company warned earlier this year there was doubt about its viability as a business after it posted a $3 billion loss for 2020 because of the pandemic’s impact. Cineplex had sought US$2.2 billion in damages from Cineworld for backing out of the acquisition.
A bankruptcy judge declined to boot a Manhattan skyscraper backed by Chinese conglomerate HNA Group Co. out of chapter 11, ruling the building owner had legitimate reasons to fear a forced sale, WSJ Pro Bankruptcy reported. Judge Mary Walrath of the U.S. Bankruptcy Court in Wilmington, Del., ruled that 245 Park Avenue owner PWM Property Management LLC could remain under court protection, deciding against its business partner SL Green Realty Corp., the skyscraper’s property manager, which argued the chapter 11 case was filed in bad faith. PWM filed for bankruptcy in October, saying it was at imminent risk of losing control of its bank accounts to mortgage lenders. Major League Baseball, a key tenant of 245 Park, is leaving the property next year, and lenders could begin confiscating cash if SL Green didn’t find a replacement tenant, according to PWM’s court papers. SL Green argued the chapter 11 case was filed to give PWM an unfair advantage in a two-party dispute that should be handled through litigation, rather than bankruptcy. Judge Walrath disagreed, saying that PWM was in financial distress and filed bankruptcy ahead of a possible “cascade” of negative consequences. “You don’t have to wait until the terrible events happen to file a bankruptcy proceeding,” the judge said in a bench ruling Monday.
Brooklyn property developer Yoel Goldman’s All Year Holdings Ltd. filed for bankruptcy Tuesday to protect itself from potential litigation in the U.S. and Israel while continuing negotiations with creditors over $1.56 billion in debt, WSJ Pro Bankruptcy reported. All Year has been in restructuring talks with bondholders since April and looking for investors to either recapitalize or outright buy its property business, according to papers filed in the U.S. Bankruptcy Court in Manhattan. Chief restructuring officer Assaf Ravid said in the papers that All Year has struggled to meet debt obligations tied to the 1,648 residential and 69 commercial units it owns in the Bushwick, Williamsburg and Bedford-Stuyvesant neighborhoods in Brooklyn. New York City’s housing market crashed during the COVID-19 pandemic but has since rebounded, fueled by residents trading up and out-of-staters moving in. Even so, All Year’s revenues aren’t expected to grow enough to satisfy its roughly $800 million in bonds governed by Israeli law and $760 million in mortgage loans, Mr. Ravid said. All Year already lost a prized luxury property in Brooklyn this year to bankruptcy.
Companies knew to expect pandemic surprises heading into winter, and they keep coming to fruition, the Wall Street Journal reported. The Biden administration’s vaccine mandate is in limbo. The threat of the Omicron variant is still being studied. International travel is getting more restrictive again. The muddled picture is causing a broad reassessment across the corporate sphere. Some companies are rethinking vaccine policies and pushing off return-to-office plans, while others are working to maintain existing timelines to bring people together. The varied responses reflect the difficulties many companies face in sizing up the state of the pandemic now and its trajectory in the months ahead, more than a dozen executives said. Meanwhile, the longer that delays persist, the more some employees get set in their at-home routines and gain conviction they can do their jobs from anywhere, for the long term. In recent days, companies as varied as Facebook parent Meta Platforms Inc., Ford Motor Co. and Alphabet Inc.’s Google have delayed return-to-office dates or given employees the option to stay home longer. Ride-hailing company Lyft Inc. told its corporate employees last week they wouldn’t be required back in its offices until 2023. Read more. (Subscription required.)
In related news, some of the largest U.S. hospital systems have dropped COVID-19 vaccine mandates for staff after a federal judge temporarily halted a Biden administration mandate that healthcare workers get the shots, the Wall Street Journal reported. Hospital operators including HCA Healthcare Inc. and Tenet Healthcare Corp. as well as nonprofits AdventHealth and the Cleveland Clinic are dropping the mandates. Labor costs in the industry have soared, and hospitals struggled to retain enough nurses, technicians and even janitors to handle higher hospitalizations in recent months as the Delta variant raged. Vaccine mandates have been a factor constraining the supply of healthcare workers, according to hospital executives, public-health authorities and nursing groups. Many hospitals already struggled to find workers, including nurses, before the pandemic. The shortages were compounded by burnout among many medical workers and the lure of high pay rates offered to nurses who travel to hot spots on short-term contracts. Read more. (Subscription required.)
