JOIN US FOR CBA'S 2021 ANNUAL MEETING
Friday, March 5th
10:00 AM - 11:00 AM
LIVE ZOOM MEETING
Meet and greet our Board of Directors and hear from our leadership about the state of the association and CBA's goals and plans for 2021.
AGENDA:
Board Chair Introduction & Comments
State of the Association & Impacts from COVID-19
The Road Ahead
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Strategic Focus & Initiatives
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Diversity, Equity, and Inclusion within Commercial Brokerage
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Government Affairs & Political Advocacy
Question & Answer
REGISTER NOW
BLACK HOMEOWNERSHIP GAP: RESEARCH TRENDS AND WHY THE GROWING GAP MATTERS
As part of the Washington REALTORS® Black History Month series, they welcomed Dr. Arthur Acolin with the University of Washington, College of Built Environments to take a deep dive into the data of Black homeownership, the research trends, and why the growing gaps matter.
WATCH VIDEO NOW
SIGN-UP TODAY TO GET HANDS-ON HELP WITH OUR NEW SEARCH PLATFORM AND LEGAL LIBRARY PRO!
CBA provides monthly webinar training to help you master all of our powerful tools and resources and make the most of your membership.
Join us Monday, February 22nd from 3:00 - 4:00 p.m., as we show you how to use our powerful Legal Library PRO tool.
Join us Thursday, February 25th from 9:00 - 10:00 a.m., to learn how to use our search platform, create reports, and manage your listings.
REGISTER NOW
NOW AVAILABLE TO MEMBERS: CBA'S Q4 CMA SALES OVERVIEW AND FULL RESEARCH REPORT 2020 VS 2019
CBA's new CMA Sales Report analyzes quarterly economic and commercial real estate activity and trends at the market and submarket levels. We are pleased to offer this detailed analysis and report for your use and interpretation.
In this report, we compare same-month sales by asset class and county from 2019 to 2020. In addition, we have provided a historical view of commercial sales over the past decade to provide the context of how the COVID-19 induced economic downturn of 2020 has impacted the market, particularly in comparison to the low points the market experienced coming out of the Great Recession.
CLICK HERE TO VIEW OUR FULL REPORT
COVID-19 UPDATE: FIVE ADDITIONAL REGIONS PROGRESS INTO PHASE 2
Effective Sunday, February 14th, additional regions entered Phase 2 of the state’s Healthy Washington – Roadmap to Recovery plan. Limited, in-person open houses are permitted in regions that have entered Phase 2. Real estate offices in both Phase 1 and Phase 2 regions may allow clients to make appointments for in-person services at the office if office capacity is limited to 25% and all other protocols are followed.
Counties in Regions that Moved to Phase 2 Effective February 14, 2021: Adams, Asotin, Ferry, Garfield, Lincoln, Pend Oreille, Spokane, Stevens, Whitman, Island, San Juan, Skagit, Whatcom, Chelan, Douglas, Grant, Okanogan, Clallam, Jefferson, Kitsap, Mason, Clark, Cowlitz, Klickitat, Skamania, and Wahkiakum
Additional Counties Already in Phase 2: King, Pierce, Snohomish, Grays Harbor, Lewis, Pacific, and Thurston.
DR. LEONARD MOORE TALKS RACE & HOUSING TO WR MEMBERS - RECORDED WEBINAR
As part of Black History Month, Washington REALTORS® is hosting a series of FREE webinars. Dr. Leonard Moore, of the University of Texas, recently presented an interesting and engaging session that used Monopoly and other easy-to-understand analogies to explain race issues, particularly in housing.
WATCH NOW
UPDATED COVID-19 PROTOCOLS: OPEN HOUSES NOW PERMITTED IN PHASE 2 REGIONS
Our friends at Washington REALTORS® recently provided the following important change to COVID-19 protocols for Phase 2 counties.
In-person activities including showings, inspections, appraisals, and final walk-throughs may now include up to five (5) persons (including the broker). The prior Phase 2 restrictions limited the number of persons on site to three (3) persons (including the broker).
Please note: Open houses are still NOT permitted in Phase 1 counties.
The other protocols for in-person activities must continue to be followed in all counties, including:
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- In-person activities must be by appointment only;
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- Face coverings are required to be worn at all times by real estate brokers, their clients, and industry partners (e.g. appraisers, inspectors, photographers, stagers, etc.). Brokers may not provide services to any client who does not wear a face covering.
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- The persons on-site must strictly follow social distancing guidelines by remaining at least six feet apart at all times; and
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The protocols for Phase 1 and 1.5 counties and Phase 3 counties have not changed. Please note that no more than two (2) persons, including the broker, are permitted on-site in Phase 1 and 1.5 counties.
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READ MORE
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NEW FAQ FOR REAL ESTATE FIRMS ON SEATTLE PAYROLL EXPENSE TAX
Our friends at Seattle King County REALTORS®, with the assistance of legal counsel, have developed an FAQ to answer questions about how and when Seattle’s new Payroll Expense Tax applies to real estate brokerage firms.
Background: On July 6, 2020, the Seattle City Council passed Ordinance 126108, which imposes a “payroll expense tax” on businesses in Seattle with annual payrolls in excess of $7,000,000.00. The tax is computed on the total payroll expense paid in Seattle to employees who receive compensation of $150,000.00 or more. Real estate brokers are considered employees, even though they may be independent contractors, and commission income is considered to be compensation.
JOIN US FOR CBA'S 2021 ANNUAL MEETING
Meet and greet the CBA Board of Directors and hear from our leadership about the state of your association and CBA's goals and plans for 2021.
Friday, March 5th
10:00 AM - 11:00 AM
LIVE ZOOM MEETING
REGISTER NOW
THE NEWLY RATIFIED CBA BOARD OF DIRECTORS SLATE FOR TERMS THROUGH 2023 INCLUDES:
- Scott Coombs, NAI Puget Sound Properties
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- John Miller, CBRE
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- Arvin Vander Veen, Colliers International
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- Monica Wallace, Wallace Properties
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- Brooks Burton, Windermere
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- Casey Brazil, Kiemle Hagood
2021 Board Officers include:
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- Chair: Brian Hatcher, Kidder Mathews
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- Chair-Elect: Monica Wallace, Wallace Properties
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- Immediate Past Chair: Tiffini Connell, - West Coast Commercial Realty
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- Treasurer: John Miller, CBRE
Each of the 16 members of CBA’s Board of Directors prides themselves on representing all specialties, voices, and geographies from the commercial brokerage industry, and includes members from the largest and most prestigious international firms, to the small, successful, and independently owned and operated firms.
GET HANDS-ON HELP
WITH OUR NEW SEARCH PLATFORM AND LEGAL LIBRARY PRO!
Do you need help mastering the ins and outs of our new Catylist search platform, creating reports for your clients, or using Legal Library PRO? We're here to help!
CBA provides monthly webinar training to help you master all of our powerful tools and resources and make the most of your membership.
Join us the last Thursday of each month to learn how to use our search platform, create reports, and manage your listings.
On the last Monday of every month, we show you how to use our powerful Legal Library PRO tool.
LEARN MORE AND REGISTER NOW
STOEL RIVES’ UPDATED GUIDE TO WASHINGTON STATE EVICTION MORATORIA AND TENANT PROTECTIONS
As the pandemic extends into 2021, COVID-related emergency eviction moratoria that were rolled out by a variety of jurisdictions in March of 2020 continue to be updated and refined in response to ongoing economic challenges. To help you navigate the various moratoria on residential and commercial evictions affecting properties in Washington State, Stoel Rives has continued to update its Guide to Eviction Moratoria and Related Tenant Protections, which includes new regulations imposed at year-end.
To view and download the latest version, updated on January 4th,
CLICK HERE
HAPPY 25TH ANNIVERSARY, AMY ROBITAILLE!
On behalf of the entire CBA team and Board of Directors, we would like to wish a happy 25th work anniversary to our Executive Vice President, Amy Robitaille.
Amy has been known to walk through fire on behalf of both our members and her team, and we are incredibly lucky and grateful to have her.
Amy, your dedication to your work and to our members is exemplary. Thank you for making such a tremendous difference in our lives!
HAPPY HOLIDAYS FROM ALL OF US AT CBA
Here at CBA, we have so much to be grateful for and many reasons to celebrate. At this special time of year, we'd like to express our deepest appreciation to you for placing your confidence and trust in us and for continuing to support us with your membership and referrals.
We look forward to serving you in 2021!
IMPORTANT UPDATE TO COVID-19 COMMERCIAL REAL ESTATE RESTRICTIONS
We understand how difficult it is right now for you to conduct your business. To help our members and their clients navigate a rapidly changing and increasingly difficult business climate, we have compiled a list of resources for Brokers, Landlords and Investors, and Commercial Tenants. We will continue to monitor the situation and will update and add to the list as new information becomes available.
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JANUARY 4, 2020 UPDATE: Governor Inslee announced an extension of the restrictions that were put in place on November 16th to help curb the surge in new COVID-19 cases in Washington State through January 11, 2021.
Some of these restrictions impact commercial and residential real estate operations. Under the new guidance and rules regarding real estate, open houses are expressly NOT permitted at this time.
As of Monday, January 4th:
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- All real estate open houses are suspended.
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Professional services should work from home. If you are unable to work from home, those services will be limited to 25% of building occupancy and closed to the general public.
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- Please note that listing showings (commercial AND residential) are still permitted by appointment with no more than five (5) people, in addition to the broker, on-site with strict social distancing.
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Our friends at Washington REALTORS® have provided updated COVID 19 Real Estate FAQs for additional guidance:
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REVISED COVID-19 REAL ESTATE FAQ
CONGRATS 2020 WOMEN IN REAL ESTATE AWARD WINNERS!
Connect Media's Women in Real Estate Awards celebrate women with achievements and inspirational stories who have reached respected positions of leadership and play key mentorship roles for others in commercial real estate.
Winning CBA Members include:
Tiffini Connell, CBA Board Member
West Coast Commercial Realty
Candice Chevaillier, CBA Board Member
Lee & Associates Northwest
Donna Brunner
HFO
Karen Benoit
Kidder Matthews
VIEW ALL WINNERS
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NOW AVAILABLE: CBA'S Q3 CMA SALES OVERVIEW AND FULL RESEARCH REPORT 2020 VS 2019
CBA's new CMA Sales Report analyzes quarterly economic and commercial real estate activity and trends at the market and submarket levels. We are pleased to offer this detailed analysis and report for your use and interpretation.
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With the rush of commercial property sales in 2019 to beat Washington’s increased Real Estate Excise Tax (REET) taking effect in 2020, in addition to the restrictions on Commercial Real Estate activity due to COVID-19 concerns, CBA anticipated that 2020 sales activity would be negatively impacted. We started a running tally from our database to compare same-month sales by asset class and county from 2019 to 2020.
VIEW FULL REPORT NOW
THANK YOU TO ALL WHO ATTENDED OUR FIRST-EVER VIRTUAL OFFERING OF WSCAR EDUCATION DAY, COMMERCIAL CORE, AND CBA FORUM
Even during the midst of COVID, we had a great turnout. Thank you to all attendees, our speakers, and sponsors, who helped make it such a successful event.
We've also included the affidavit form for your completion. Please don't forget to turn it in.
AFFIDAVIT FORM
CONGRATULATIONS, 2020 SIOR BROKERS OF THE YEAR!
We’d like to congratulate all of the SIOR Broker of the Year winners awarded at NAIOP’s Night of the Stars event. Winning CBA members include:
SIOR 2020 Investment Broker of the Year
Eli Hanacek - CBRE
SIOR 2020 Industrial Broker of the Year
Bill Condon - Colliers International
SIOR 2020 Office Broker of the Year
Jesse Ottele - Newmark Knight Frank
To view the full winner's gallery,
CLICK HERE
CBA MEMBERSHIP DUES TO INCREASE, FEBRUARY 1, 2021
An increase in CBA’s membership
dues and office/branch fees will go into effect on February 1, 2021.
Raising dues is always a last resort for CBA’s Board for Directors and our management team. Over the past few years, we have invested heavily in providing members new and improved essential tools to conduct their business. Additionally, our organization, like most businesses in our region, faces increasing inflationary cost pressures related to data, technology platforms, salaries, benefits, and rents.
As we look forward, it has been deemed necessary to help pay for future investments and to continue to offer our members improved tools and high-quality service at a low and reasonable price. We have included an updated 2021 fee schedule for your reference.
If you have any questions or concerns,
please contact your office’s designated broker or office manager.
CBA MEMBERS NAMED TO PSBJ’s POWER 100
Congratulations to CBA Board Member John Miller (CBRE), and members Beth Halvorsen (Colliers International) and Bill Frame (Kidder Mathews) for being named to the Puget Sound Business Journal’s annual list of the most powerful and influential businesspeople in Washington.
WE'VE UPDATED OUR LEASING FORMS IN LEGAL LIBRARY PRO
In response to requests from the CBA member community, we're pleased to announce that we've updated our Leasing Forms in Legal Library PRO to make them more useful, usable, and flexible.
CBA's Leasing Forms have been fully reviewed, revised, and vetted to ensure they meet all legal criteria and best practices. We also changed the format to make filling them out easier.
PLEASE NOTE: We've made considerable substantive changes to the Leasing Forms. We highly recommend that you watch the video from our legal counsel, Bethany C. Kelsch from Stoel Rives, to fully understand the changes that have been made before using the revised forms.
WATCH THE VIDEO
We've also provided a complete overview of all of the changes made to the Leasing Forms.
VIEW FULL OVERVIEW
UPDATING YOUR MAIN PROPERTY IMAGE & TIPS FOR ACCURATELY SEARCHING CBA'S NEW PLATFORM
You can now update your main property image directly on the CBA My Listings Page!
We've sent out an email with detailed steps on how to update your image correctly. It also includes an important tip on choosing the correct parameters in our new search platform depending on whether you are looking for Sale or Lease listings.
GO TO YOUR LISTINGS NOW
SIOR® OFFICE BROKER, INDUSTRIAL BROKER & INVESTMENT BROKER OF THE
YEAR FINALISTS
We are pleased to announce this year's SIOR® Broker of the Year finalists. Winners for each category will be announced on Friday, November 6, at NAIOP’s first-ever virtual Night of the Stars.
2020 Finalists Include:
- Bill Condon, SIOR – Colliers International
- Eli Hanacek – CBRE
- Thad Mallory, SIOR – Newmark Knight Frank
- Erik Nelson, SIOR – Kiemle Hagood
- Jesse Ottele – Newmark Knight Frank
- Wilma Warshak, SIOR – Washington Real Estate Advisors
2020 COMMERCIAL REAL ESTATE LEADERSHIP AWARDS ANNOUNCED
The Puget Sound Business Journal has announced the winners of the Commercial Real Estate Leadership Awards. Our own CBA member Rob Nielsen, Executive Vice President at JLL, has received the Giving Back Award. Congratulations, Rob!
These leaders will be honored during a special virtual reception on Tuesday, October 6th. They will also be profiled in the PSBJ CRE Leadership special section that will publish on Friday, October 30th.
WE'VE UPDATED OUR
PURCHASE & SALE SUITE ON LEGAL LIBRARY PRO
We're pleased to announce that we've updated our Purchase & Sale Suite in Legal Library PRO to make the forms more useful, usable, and flexible in response to requests from the CBA member community.
CBA's forms have been reviewed and revised to ensure they meet all legal criteria and best practices. We also changed the format to make filling them out easier.
We've produced a video with our legal counsel, Hunter Jeffers from Stoel Rives, to clearly explain the changes that have been made.
CLICK HERE TO WATCH OUR VIDEO
The revised forms include the following:
17 - Seller Disclosure Statement-Improved Property
17C - Seller Disclosure Statement-Unimproved Property
22E - Certification Under the Foreign Investment in Real Property Tax ("FIRPTA")
BB-1 - Buyer's Agency Agreement
BU-A - Back-Up Addendum to Purchase and Sale Agreement
CDF - Commission Disbursement Form
EMN - Earnest Money Promissory Note
FMA - Force Majeure Addendum
LOI-PSA - Letter of Intent
LP-LS - Disclosure of Information on Lead-Based Paint and Lead-Based Paint Hazards
LPB-20 - Short Form Deed of Trust
N-1A - Promissory Note
OTB - Option to Buy Real Estate
PS-1A - Commercial and Investment Real Estate Purchase & Sale Agreement
PS-AS - Assignment and Assumption Agreement
PS-D - CBA Defeasance Addendum
PS-FIN - Financing Addendum
PS-TEC - Tenant Estoppel Certificate
PSA - Addendum/Amendment to Purchase and Sale Agreement
PSR - Rescission of Purchase and Sale Agreement
RC - Recorder's Cover Sheet
SS - Short Sale Addendum
UA - Utility Charges Addendum
VLA - Vacant Land Addendum
XA - Exclusive Agency Sale Listing Agreement
XS - Exclusive Sale Listing Agreement
IMPORTANT NOTE: When adding documents to your transactions, members will receive the newest version(s). This will not affect open transactions, and all of CBA's previous forms are still valid and legal.
LOGIN TO LEGAL LIBRARY PRO NOW
NOW AVAILABLE TO MEMBERS: CBA'S 1ST HALF 2020 VS 1ST HALF 2019 CMA SALES OVERVIEW AND FULL RESEARCH REPORT
CBA's latest CMA Sales Report analyzes monthly and quarterly commercial real estate sales activity and trends at the market and submarket levels through the first 6 months of 2020. We are pleased to offer this detailed analysis and report for your use and interpretation.
With the rush of commercial property sales in 2019 to beat Washington’s increased Real Estate Excise Tax (REET) taking effect in 2020, in addition to the restrictions on Commercial Real Estate activity due to COVID-19 concerns, CBA anticipated that 2020 sales activity would be negatively impacted. We started a running tally from our database to compare same-month sales by asset class and county from 2019 to 2020.
OVERVIEW
Same month comparisons in the 2nd quarter from 2019 to 2020 showed even bigger declines than in the 1st quarter. April transaction counts from 2019 to 2020 were down 57.9% with sales dollar volume down 76.8%. May showed the biggest drop in transactions year to date, as numbers were down 69.3% compared to May 2019. May 2020 dollar volume received a slight boost from two key deals, Waterscape Juanita Village in Kirkland and Everett 4 Corners Plaza, putting the decline at 62.8%. June 2020 transactions fared better than April or May, showing only a drop of 48.5% compared to June 2019. However, sales dollar volume was the biggest slide of the year, showing an 81.8% decline compared to June 2019.
Year to date, Multifamily (-80.2%) and Office (-78.1%) continue to show the biggest drops in sales volume, while Retail (-31.9%), Land (-30.4%), and Industrial (-41.2%) are comparatively less impacted. All researched counties except Thurston are down a considerable amount. Thurston is holding onto a positive 12% increase in sales volume compared to the same timeframe in 2019, mainly propped up by a strong January and April.
CBA researches office, retail, industrial, and land sales, $250,000 or more, in King, Snohomish, Pierce, Spokane, Kitsap, and Thurston counties. Multi-family sales of $250,000+, and 5-units or more are researched in King, Pierce, and Snohomish counties. All the raw data provided is pulled directly from the CBAcma database.
CLICK HERE TO VIEW OUR FULL SALES REPORT
CBA BOARD MEMBER CANDICE CHEVAILLIER HONORED AS ONE OF 48 GLOBEST. REAL ESTATE
FORUM’S WOMEN OF INFLUENCE
We’d like to congratulate CBA Board Member Candice Chevaillier, Principal at NW Multifamily Team at Lee & Associates, on being named as a top CRE Consultant/Advisor in GlobeSt. Real Estate Forum’s Women of Influence edition. Honorees are recognized as outstanding women leaders in the commercial real estate industry.
OUR NEW SEARCH PLATFORM IS LIVE!
We're pleased to announce that Phase 1 of our NEW search platform is now available! This phase includes the searching, reporting, and demographic features our members have requested.
Throughout the upcoming phased transition, CBA will run the new Catylist-powered search platform in parallel with our existing platform throughout all three phases to allow you sufficient time to be trained and make full use of its powerful tools.
Rest assured that regardless of how you choose to search our listings during our transition period, you’ll see the exact same data and search results across both the new and legacy platforms.
BENEFITS OF THE NEW PLATFORM INCLUDE:
Powerful, Easy-to-Use Technology
CBA's new, mobile-friendly platform works seamlessly on all browsers and devices, so you can access your listings and marketing tools anytime, anywhere! The platform provides all of the functionality our members have requested and come to expect with a streamlined, intuitive, easy-to-use interface.
Local Understanding, National Exposure
By partnering with Catylist, we can give you the best of both worlds: a local service specifically tailored to the needs of your markets, with the benefits of exposure on Commercial Exchange, Catylist's nationwide network.
SEARCH OUR NEW PLATFORM NOW!
NEW ENHANCEMENTS MADE TO LEGAL LIBRARY PRO!
Based on member feedback and requests, we’re pleased to
announce that we have made several enhancements to the functionality of Legal Library PRO.
These upgrades are designed to help you search for transactions, create custom templates, fill out and edit forms, and invite users to collaborate more quickly and easily.
These NEW enhancements Include:
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Auto-Fill Document Content: Auto-filled content (including Buyer, Seller, Property Address) now displays in both fill out and edit modes.
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Quickly Add Documents: You can now select documents and hit “Done” to add them to your transaction without first having to click “Add Documents.”
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Add Additional Transaction Details: A new “Document Note” field has been added so you can easily differentiate between forms of the same name — which is particularly helpful with multiple addendums.
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Search Transactions Faster: Hitting “Enter” will now execute a search, whether you’re searching for a transaction or searching for a form.
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Invite Users to Collaborate More Easily: Changes have been made to provide additional clarification about access levels for Transaction User and Document User.
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LOGIN TO LEGAL LIBRARY PRO
NOW AVAILABLE TO MEMBERS: CBA'S CMA 2020 VS 2019 DETAILED SALES OVERVIEW AND FULL RESEARCH REPORT
CBA's new CMA Sales Report analyzes quarterly economic and commercial real estate activity and trends at the market and submarket levels. We are pleased to offer this detailed analysis and report for your use and interpretation.
With the rush of commercial property
sales in 2019 to beat Washington’s increased Real Estate Excise Tax (REET) taking effect in 2020, in addition to the restrictions on Commercial Real Estate activity due to COVID-19 concerns, CBA anticipated that 2020 sales activity would be negatively impacted. We started a running tally from our database to compare same-month sales by asset class and county from 2019 to 2020.
OVERVIEW
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The number of transactions from January 2020 compared to 2019 was down 18.7%, and dollar volume was down 69%. February transactions had a 7.8% drop and saw the same drop of 69% in dollar volume. March transactions were down 14.1%, but dollar volume was softened by the retail sale of the former Macy’s department store in downtown Seattle for $68.7m, which made for a more modest decrease of 42.2%. On March 15th, the state-wide COVID-19 shutdown and reduced sales
leading up to and throughout April
made for the biggest drops to date.
April transactions were down 57.9%, and dollar volume was down 76.8%.
Overall, the biggest discrepancies in volumes were seen in the Office (-76.3%) and Multi-family (-78%) classes, while the smallest declines in volume were Retail (-14.1%) and Land (-15.2%). Multiple large deals in 2019 greatly affected sales volume disparities, which are listed throughout the report as notable sales.
In comparison, 2020 has had only one
nine-figure deal with the office sale of Tower 333 in downtown Bellevue for $401.5m. 2020 vs 2019 transactions and dollar volume are negative across all asset classes and counties so far, with the exception of Thurston County, which shows a net positive in sales volume of 38.3%.
CLICK HERE TO VIEW OUR FULL SALES REPORT
NEW! EXCLUSIVE SUBLEASE AGREEMENT ADDED TO LEGAL LIBRARY PRO
In response to our rapidly changing commercial real estate market and in anticipation of shifting member needs, we've added an Exclusive Sublease Agreement to Legal Library PRO.
Developed by top commercial real estate experts, Legal Library PRO's contracts are recognized as the industry standard and are the fastest and easiest way to close a deal.
CBA members can instantly access and edit any of Legal Library PRO's 100+ copyrighted contracts and forms for Washington and Idaho. Forms include Purchase and Sale Agreements for Commercial Properties as well as Business Opportunities and Lease Agreements.
SPECIAL WEBINAR: LIMITATIONS ON COMMERCIAL TENANCIES IN THE TIME OF COVID-19 WITH HUNTER JEFFERS
If you were not able to join us for the recent webinar regarding the limitations on commercial tenancies in the state of Washington and City of Seattle and how it might impact you, we have recorded the webinar and have posted it to our COVID-19 resources tab. Click below to watch it now.
Our friends at Washington REALTORS® recently provided the following important and timely guidance on applying for Unemployment Assistance in Washington state, and we're sharing this valuable information with our members.
CLICK HERE TO READ MORE
IRS EXTENDS TAX DEADLINES: RELIEF FOR 1031 EXCHANGES AND OPPORTUNITY ZONES
On April 9th, the IRS granted deadline relief for both 1031 like-kind exchanges and opportunity zone investments that are already underway. Both of these programs promote economic growth in communities, and the NAR and other CRE advocacy groups successfully argued that investors in these programs should not be harmed due to the effects of COVID-19. Some specifics of the new guidance include:
1031 Like-kind Exchanges: If an investor has taken the first step of a like-kind exchange by selling the old property, and either the 45-day or the 180-day deadline falls between April 1 and July 15, the deadline has been extended to July 15.
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Opportunity Zones: If investors who sold a capital asset planned to roll over the gain into an Opportunity Fund and the 180-day deadline to do so falls between April 1 and July 15, 2020, they can make the investment as late as July 15.
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Estimated Tax Payments: Sole proprietors who pay quarterly estimated taxes now have until July 15 to file their second-quarter payment. Any individual or corporation that has a quarterly estimated tax payment due on or after April 1, 2020, and before July 15, 2020, can wait until July 15 to make that payment, without penalty.
NEW FORCE MAJEURE AND CLOSING ADDENDUM TO PURCHASE AND SALE AGREEMENT
The Commercial Brokers Association has published a new addendum to help address issues arising from the COVID-19 pandemic. The form, entitled “FMA Force Majeure
Addendum,” is posted for use in Legal Library PRO within the Purchase & Sale Forms and is also posted in the List of Contracts. (Note: you must be logged in to the CBA website to view the form.)
It may be used in new transactions as an addendum or existing transactions
as an amendment to provide for remedies in the event either party is prevented from performing in a transaction due to a force majeure.
“Force majeure” is a French term that translates literally as “superior force.” A “force majeure event” is an event or effect that can be neither anticipated nor controlled. Many contracts contain a force majeure clause allocating risk between parties if the contract becomes impossible or impractical to perform in the event of a force majeure. Common examples of force majeure events include acts of nature, such as floods, earthquakes, hurricanes, tornadoes and the like, and acts of people, such as wars, riots or strikes and, of course, an epidemic/pandemic such as the current pandemic.
DISCUSSION
CBA’s new addendum provides for extensions of contingencies and conditions and the closing date in purchase and sale agreements for a limited amount of time should a force majeure event occur, precluding timely performance. It operates in the same way as the residential addendum recently released for the same purpose by NWMLS.
The addendum provides that, if through no fault of the parties, and by reason of a force majeure event, any contingency or condition in the agreement cannot be timely completed, then all the time periods associated with that contingency or condition (and any related notices and responses thereto) are extended for an amount of time agreed to and stated in the form.
An example may help:
The parties reach mutual acceptance on March 25, and the buyer has a ten-day inspection/feasibility contingency.
On March 26, a shelter-in-place order goes into effect for two weeks (until April 9) that prevents the selling broker, buyer and inspector from inspecting the property. The parties agree in the addendum that any contingency or condition will be extended for ten days should a force majeure event occur. The original contingency would have expired on Monday, April 6, but the addendum would extend the contingency to April 16, including any related notice and response timeframes.
Obviously, dealing with force majeure events are circumstances unfamiliar to the industry. Calculating the extension of contingency time periods due to a force majeure event may be complicated. Brokers are encouraged to cooperate and work together to ensure that the parties have the same expectations with regard to timelines, and any impact a force majeure event may have.
The addendum provides that, if through no fault of the parties and by reason of a force majeure event, the sale of the property cannot be timely closed on the Closing Date, the date will be extended for an agreed-upon period of time – the “Extended Closing Date.” If the sale of the property cannot be timely closed by the Extended Closing Date, the transaction terminates and the earnest money will be refunded to the buyer.
CONCLUSION
CBA recommends that all brokers working on pending transactions consider amending the transaction with this or an equivalent addendum to address force majeure events. Certainly, brokers entering into new transactions should recommend their clients consider a force majeure addendum.
If you have any questions, please call us at (425) 820-3348, send us an email, or start an online chat.
IMPORTANT COVID-19 UPDATE:
CBA STAFF WORKING REMOTELY AND ALL IN-PERSON CLASSES CANCELED UNTIL FURTHER NOTICE
At the Commercial Brokers Association, we're concerned about the impact of the COVID-19 virus on our staff and our members and have been following the rapidly changing situation closely.
Due to the local impact of the COVID-19 pandemic and our need to keep our employees and their loved ones as safe and as healthy as possible, CBA’s staff will be working remotely until further notice.
CBA has the technology and phone systems infrastructure to ensure all our services, support, and applications will run smoothly during this time. Our members should not notice any difference in support or interruptions in our services.
If you have signed up for a class or event through one of our managed associations, please visit the association website directly for updates on their classes and events.We will reschedule canceled classes at a later date if feasible. If you registered for a canceled class, you received a message directly from our Education Manager, Kristin Austin. Please email or call Kristin at 425-952-2739 about options to reschedule, use your credits for a future class, or obtain a refund.
Certified Commercial Investment Member (CCIM) Washington State Chapter
CoreNet Global Washington State Chapter
Commercial Real Estate Women (CREW) Washington State Chapter
The Institute of Real Estate Management (IREM) Washington State Chapter
The Society of Industrial and Office REALTORS® (SIOR) Washington State Chapter
Washington State Commercial Association of REALTORS® (WSCAR)
For all classes and events, please remember to check our full schedule for up-to-date information BEFORE you leave to attend.
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CBA DATA FEATURED IN PSBJ
CBA’s CMA data and analysis on commercial property sales over the past 10+ years was recently featured in the Puget Sound Business Journal's Real Estate section. This underscores the quality of our data and terrific work done by the entire staff. Watch for additional data and analysis from our team in future editions!
The numbers highlighted are for King, Pierce, and Snohomish counties. To see a more in-depth version that also contains Kitsap, Spokane, and Thurston counties, click here.
