May 29, 2020

Reps. Lawson, Taylor, Barr Introduce Bipartisan Legislation to Prevent Foreclosures and Protect American Jobs

The Helping Open Properties Endeavor (HOPE) Act

WASHINGTON - After hearing from constituents in their Congressional Districts, U.S. Congressmen and members of the House Committee on Financial Services, Al Lawson (D-FL-05), Van Taylor (R-TX-03) and Andy Barr (R-KY-06) introduced legislation to provide economic support to the commercial real estate (CRE) market, especially for businesses with Commercial Mortgage-Backed Securities (CMBS) debt, and the millions of Americans they employ.

H.R. 7809, the Helping Open Properties Endeavor (HOPE) Act works to protect millions of jobs across the nation by preventing Commercial Real Estate (CRE) foreclosures, specifically to borrowers of commercial mortgages.

“COVID-19 is causing many of our industries to experience major financial hits, and commercial real estate is no exception,” Rep. Lawson said. “The Helping Open Properties Endeavor Act establishes a lending facility to help the industry stay afloat — allowing borrowers to seek relief without violating their loan agreements. Without immediate action, we may see unrecoverable losses to these businesses.”

As a result of the COVID-19 pandemic, businesses across the country have experienced revenue declines and cash flow shortages, making it difficult to meet monthly debt obligations and ultimately, threatening the livelihood of their business. While Congress and federal agencies have provided critical assistance to many businesses experiencing financial hardship through programs such as the Paycheck Protection Program and Main Street Lending Programs, these initiatives do not fit the needs of the commercial real estate market. 

Rep. Taylor said, "Millions of jobs and the prosperity of entire communities depend on keeping these properties open. These industries don't need a bailout, but they do need flexibility and support provided in the HOPE Act to keep their doors open, drive local their local economies, and support families across the country."

The commercial real estate market encompasses hotel, retail, multi-family housing, industrial, and commercial property, industries which support millions of jobs throughout the United States.

Rep. Barr said, “The COVID-19 pandemic and the ensuing government-imposed shutdown of the economy severely threatened the commercial real estate market. “The HOPE Act is a lifeline for commercial borrowers so they can stay in business, avoid foreclosure, keep their employees on staff and emerge intact on the other side of this crisis.”

Specifically, H.R. 7809, the HOPE Act, provides borrowers of commercial mortgages, who have been hit the hardest economically by COVID-19, financial assistance through the HOPE Preferred Equity lending facility. Guaranteed by the Department of the Treasury, financial institutions will originate preferred equity instruments to borrowers.