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The pandemic has aggravated the housing market’s longstanding lack of supply, creating a historic shortage of homes for sale, the Wall Street Journal reported. Buyers are accelerating purchase plans or considering homeownership for the first time, rushing to get more living space as many Americans anticipate working from home for a while. Many potential sellers, meanwhile, are keeping their homes off the market for pandemic-related reasons. The combined effect has created an extreme drought of previously owned homes for sale. At the end of July, there were 1.3 million single-family existing homes for sale, the lowest count for any July in data going back to 1982, according to the National Association of Realtors. In the week ended Sept. 12, total for-sale inventory was down 29.4 percent from a year earlier at the lowest level since at least late 2017, Zillow Group Inc. said.

In the wake of the COVID-19 outbreak, as businesses across the country urged employees to work from home, rents plunged in New York City, San Francisco and other densely-populated cities, Reuters reported. Still, prominent hedge funds, including D1 Capital Partners and Long Pond Capital and mutual fund giants Capital Group and T. Rowe Price, purchased shares in the second quarter in companies that rent residential real estate in urban markets, buying in at beaten-down levels and possibly betting on a faster rebound than Wall Street forecast. Now, nearly three months later, shares of real estate trusts that specialize in urban apartment rentals are down more than the broader real estate sector and the benchmark S&P 500 stock index for the year-to-date and since the March market rout. Shares of Equity Residential, founded by billionaire Sam Zell, are up 7 percent since the March low, AvalonBay Communities, which owns the Avalon Morningside Park with views of Manhattan, and UDR are up 26 percent and 14 percent, respectively, while the S&P 500 is up 48 percent. “The next three to five years are going to be very challenging,” said Jonathan Litt, whose hedge fund Land & Buildings Investment Management concentrates on real estate. “The key is to stay alive until 2025 in these markets.”

Americans with mortgages have accumulated nearly $10 trillion in home equity thanks to a decade of rising home prices. Yet millions of them have fallen behind on mortgage payments and risk losing their houses, the Wall Street Journal reported. It is a potential bonanza for rental-home investors. Since the coronavirus pandemic began, big single-family landlords have raised billions of dollars for home-buying sprees. Even if there isn’t a surge in repossessed homes to buy cheaply off the courthouse steps — which led to the emergence of Wall Street’s landlords during the foreclosure crisis a decade ago — there are likely to be a lot of forced sales and new renters. “A lot of people are house-rich but cash-poor,” said Ivy Zelman, chief executive of real-estate consultant Zelman & Associates. “If they bought in the last two or three years, even if they bought five months ago, they have equity.” Having plenty of home equity but reduced means to keep making payments could prompt many to sell while prices are high and exit homeownership with a cash cushion, Zelman said. People behind on their payments aren’t being kicked out of their houses yet because of federal and local restrictions on foreclosure enacted during the pandemic. Many with federally guaranteed mortgages have entered forbearance, which allows them to skip payments for up to a year without penalty and make them up later. Some 3.5 million home loans — a 7.01 percent share — were in forbearance as of Sept. 6, according to the Mortgage Bankers Association. Many more borrowers are behind on their payments but not in forbearance programs with their lenders.

About one million homeowners have fallen through the safety net Congress set up early in the coronavirus pandemic to protect borrowers from losing their homes, according to industry data, potentially leaving them vulnerable to foreclosure and eviction, the Wall Street Journal reported. Homeowners with federally guaranteed mortgages can skip monthly payments for up to a year without penalty and make them up later. They must call their mortgage company to ask for the relief, known as forbearance, though they aren’t required to prove hardship. Many people have instead fallen behind on their payments, digging themselves into a deepening financial hole through accumulated missed payments and late fees. They could be at risk of losing their homes once national and local restrictions on evictions and foreclosures expire as early as January. “Some borrowers are falling through the cracks that we’re not picking up,” said Lisa Rice, president and chief executive of the National Fair Housing Alliance. About 1.06 million borrowers are past due by at least 30 days on their mortgages and not in a forbearance program, according to mortgage-data firm Black Knight Inc. Of those, some 680,000 have federally guaranteed mortgages and thus qualify for a forbearance plan under a March law. The rest have loans that aren’t federally guaranteed, and their lenders aren’t required to offer forbearance, though many have chosen to do so. Lenders and consumer groups said the number of past-due mortgages that aren’t in forbearance could grow as several million people who are in forbearance reach the six-month point of their plans by the end of October. An extension of up to six months is possible, but homeowners must ask for it. Lenders said they are reaching out to these borrowers before their forbearance periods expire.

One of Manhattan’s most prolific condo developers is facing potential foreclosure on four properties, after years of laggard sales — and a lender finally fed up waiting for returns, Bloomberg News reported. An $89.5 million slice of junior mezzanine debt tied to projects by Ziel Feldman’s HFZ Capital Group will be sold at a public auction on Nov. 12, according to brokerage Newmark Knight Frank, which is promoting the offering. Public sales are typically ordered for loans that are in default. The debt up for auction is backed by four Manhattan rental buildings that HFZ bought in 2013 and redeveloped into pricey condos: The Astor on the Upper West Side, 88 and 90 Lexington Ave. in NoMad and 301 W. 53rd St. in Hell’s Kitchen. Buyers of the junior debt on those properties would potentially be in a position to pay off senior lenders and assume full ownership. HFZ’s condos piled onto the market in 2015, a time when high-dollar offerings in brand new towers were already in plentiful supply. Wealthy homebuyers saw no rush to commit to a purchase amid so many choices. Three years later, while HFZ was still working to offload those units, it listed $3 billion worth of condos in two additional projects, essentially competing against itself. 

The Aspen (Colo.) Club and Spa is out of bankruptcy and back into foreclosure, but this time owner Michael Fox said he and his team won’t be battling their creditors, the Aspen Times reported. Fox held an optimistic outlook about The Aspen Club’s prospects when it had been pushed into foreclosure before, as well as when it declared chapter 11 bankruptcy in May 2019. Last week, however, saw a judge dismiss the bankruptcy case in Denver on Sept. 1 and a creditor file documents in Pitkin County on Sept. 2 to foreclose on the east Aspen property. GPIF Aspen Club for the second time is attempting to foreclose on the Aspen Club. Attorneys at the law firm that filed foreclosure paperwork with the Pitkin County Clerk and Recorder’s Office could not be reached for comment Wednesday, but the documents state that Aspen Club owes $30 million to GPIF. GPIF Aspen Club is affiliated with Dallas investor Jeff Goff’s GP Invitation Funds and is associated with companies that own the Canyon Ranch luxury resorts in Tucson, Arizona, and Lenox, Massachusetts, and the Brown Palace hotel in Denver. Aspen Club attorneys previously argued in the bankruptcy proceedings that GPIF Aspen Club was making a play on the property, something GPIF’s legal team argued was not the case.

It has been a prolonged period of retail carnage: Storied names declaring bankruptcy, mass-market brands closing thousands of stores, tens of thousands of shop employees furloughed or laid off, garment workers in dire straits. For Jamie Salter and David Simon, however, it has been a time of great opportunity, the New York Times reported. Salter is the founder and chief executive of the Authentic Brands Group, a company known for buying the intellectual property of famous brands at discount prices and then striking licensing deals with other companies that want to stick those well-known names on their products. Simon is the chief executive of the Simon Property Group, the largest mall operator in the U.S. with more than 100 properties including Twin Cities Premium Outlets in Eagan, Albertville Premium Outlets in Albertville, Southdale Center in Edina and Miller Hill Mall in Duluth. Together, they are reshaping the American retail landscape. Last week, they closed a deal to buy the bankrupt Brooks Brothers, the 202-year-old American fashion brand and retailer, for $325 million. Last month, they acquired Lucky Brand denim, and in February, they bought Forever 21. Together, the acquisitions will bring the global revenue generated by the company’s brands — a sprawling mix that includes Sports Illustrated and rights tied to Marilyn Monroe’s likeness — to $15 billion annually. And Salter is hunting for more. Many of the acquisitions are being made through a joint venture with Simon called SPARC, for Simon Properties Authentic Retail Concepts. Its roots go back to 2016, but it was created in its present form in January as a vehicle that turned out to be almost perfectly positioned to take advantage of the current state of the industry.

Co-working company Regus Corp., which provides furnished workspace on short-term deals, has placed more of its portfolio into chapter 11 bankruptcy as office markets in U.S. cities deal with financial pressure caused by the coronavirus pandemic, WSJ Pro Bankruptcy reported. In recent days, Regus has put more than a half-dozen affiliates that hold leases in cities from New York to California into chapter 11 in U.S. Bankruptcy Court in Wilmington, Del. Among the latest filings, on Thursday, were Regus affiliates managing workspaces in New York City, Los Angeles and Denver. A handful of other Regus companies—including ones that hold leases in Philadelphia and San Jose—have been placed into chapter 11 in the past week. They joined other companies—with leases in Washington, D.C.; Arlington Va.; Columbus, Ohio; Chicago; Atlanta and Fort Lauderdale, Fla.—that were placed in bankruptcy in July and August. The latest filings were already contemplated in Regus’s overall restructuring strategy and affect a small portion of its holdings, about 2 percent of the company’s North American portfolio. The spate of filings comes after the company said it would use the breathing spell bankruptcy provides to continue negotiating with some of its landlords. The chapter 11 filings represent a small share of Regus’s overall portfolio. Regus offers on-demand workspace in more than 1,000 locations in the U.S. and Canada.