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Major Western Region Leasing Markets Predictions and Updates

A panel of commercial real estate leasing experts shared their predictions and updates for major Western region markets at the 14th Annual View From the Top. Panelists included Jeffrey Welch, Executive Vice President of CBRE; Christopher T. Roeder, Executive Managing Director of JLL; David Sternberg, Executive Vice President of Northern California & Mountain Regions of Brookfield Properties; and David Abbot, Executive Vice President of Colliers. The panel was moderated by Allen Matkins partner Tony Natsis.

The panelists agreed that the number one priority at the moment is getting people back to work in the office—a sentiment also shared by tenants and property owners. Overall, the outlook remains positive in the leasing market.

LOS ANGELES

Los Angeles saw the second-lowest occupancy in the country during the COVID-19 pandemic. The massive 235 million square foot market has seen rents increase in five of the last six quarters despite the fact that the city has been shut down for the last 18 months and vacancy rates are as high as 40%. Driving the rent increases are 12 million square feet of new space scooped up by the tech industry.

There have been pockets of activity in Culver City, Burbank, and Hollywood mostly related to the booming techtainment industry in the area. Demand for entertainment has remained high, increasing the need for soundstages and the like.

In contrast, the downtown Los Angeles market has been stagnant, as the companies that traditionally occupy those spaces have stayed home. These finance, real estate, and insurance companies continue to perform well, but there is some speculation that they will need less space after the pandemic ends.

Across all markets in the Los Angeles area, concessions are at all-time highs. There is no indication that these concessions will fall or rental rates will drop in some of the less popular areas. Moving forward, landlords and tenants are looking for flexibility and efficiency. Flexibility is key, as tenants may not know exactly what they need until they get everyone back in the office and are able to see how they want to use their space.

SAN FRANCISCO

San Francisco was significantly impacted by the COVID-19 pandemic as the city shut down. Occupancy rates and public transportation ridership were the lowest in the country. Vacancies reached 20%. With a high density of office space in the downtown area, commercial activity in the city appeared flat. Behind the scenes, business continued from home offices and living rooms. A tremendous amount of wealth generation continued, unemployment rates remained low, and companies in the region continued to hire employees.

The best subleases in the area are moving again, and many of the current subleases will expire in the next three years. Priorities in the city include getting people back to work in the office, and that requires making workers feel safe and comfortable outside their homes. As tech companies begin to return to work, the abundant supply of sublease space should dissipate.

Highlights in the Bay Area include 5M, a mixed-use development in downtown San Francisco. The building will be 100% leased before the end of 2021, and tours have significantly picked up now that people have the ability to physically walk through the facility and see the health and wellness attributes. Progress on Pier 70 continues, and a lot of the infrastructure has been completed, making it possible for people to walk the grounds.

SEATTLE

The leasing market in Seattle has seen an uptick in demand for sublease and new-to-market tenants in the last two to three months. Notably, some sublease space is coming off the market as landlords anticipate companies returning to work in the coming months. Key players in the area include tech companies, as well as life sciences companies gaining momentum.

Bellevue was a bright spot during the pandemic due to Amazon’s expansion in the area. However, the company has been a disruptor in the space. Much of the current construction work downtown is related to Amazon projects, and the company also had incentivized tenants to move before their leases ended, with plans to take over those spaces.

In the South Lake Union area, projects originally constructed as office space have been pivoted to the life sciences. This includes Cascadian and Dexter Yard, which are now targeting tech and life science companies. This trend may continue and lower the amount of office space in the area.

The Puget Sound area should see a robust end-of-the-year. Executive transitions at Amazon and the potential election of a business-savvy mayor are factors that could affect growth in the region.

Article By

Anton N. Natsis
Allen Matkins Leck Gamble Mallory & Natsis LLP

L&E News Alert: Alabama Unemployment (UI) Fraud and Abuse

Introduction

The Alabama Department of Labor (“ADOL’) is working closely with the U.S. Department of Labor and various other state and federal law enforcement agencies around the country to share information regarding the unprecedented rise in unemployment insurance fraud. As a response, the ADOL is encouraging employers to advise their employees to take reasonable measures to protect personal information, establish PIN and passwords that are difficult for an outside person or computer to generate, and be vigilant in identifying any suspicious activity related to unemployment claims.

Indicators of Fraudulent Activity

The ADOL encourages employers to be vigilant in recognizing the various indicators of fraudulent activity and advising their employees accordingly. For example, receipt of mail from the ADOL notifying an employee of a claim in their name when they have not filed an unemployment claim is an early indicator of fraudulent activity. In addition, receiving an IRS Form 1099-G stating an employee has income from unemployment when they have not filed an unemployment claim is an indicator of fraudulent activity. If an employee filed for benefits, receipt of this form is to be expected as benefits are taxable income in most states. However, in some cases, this could be the first indication that a fraudulent claim has been made. Text messages from the ADOL asking an employee to verify their unemployment account is also an indication of fraudulent activity. Employees should be advised that the ADOL does not use text messages to correspond with claimants. Lastly, employers receiving claim notices on employees who do not exist or who never terminated employment with said employer is an indicator of fraudulent activity. If an employer or employee suspects any of the aforementioned indicators of fraudulent activity, they are asked to report it to the ADOL.

Reporting 1099-G Fraud

Employers should provide a gateway for employees to report fraudulent activity. For example, an employer may advise its employees to report to its HR Department if an employee receives an IRS Form 1099-G for fraudulent benefits. In addition, an employee should then be directed to  report the fraud to the State Workforce Agency  and to the Federal Trade Commission (“FTC”) at https://identitytheft.gov/. The FTC provides employees with a personalized recovery plan and can walk an employee through each step of the recovery process. Employees should also report the identity theft to the IRS. This allows employees to avoid paying taxes on the fraudulent income.

Reporting Fraud to ADOL

If your employee suspects fraudulent activity, they should be advised to report it to the ADOL at www.labor.alabama.gov. The ADOL conducts various types of fraud and abuse investigations on unemployment claims to ensure the accuracy of benefit payments. The ADOL allows an employee to report the following: (1) Report that they suspect someone has used their social security number to work or claim UI benefits, including those who have received a 1099-G but did not receive unemployment benefits; (2) Report any suspected UI benefit fraud and abuse; and (3) Report that they suspect an employee or employees receiving UI after returning to work, or of receiving PPP funds that may impact the individual’s eligibility for UI benefits.

Conclusion

Unemployment fraud is a national issue and the ADOL is working diligently to encourage employers to take reasonable measures to protect their employees in advising them to protect personal information and report any suspicion of unemployment fraud or abuse. We will continue to assess any developments implemented by the ADOL to protect the identities of employees. We are available if you have any questions.

Roland Sanchez-Medina Jr joins Leaders in Law as the exclusive Corporate Law member in Florida, USA

Leaders in Law, the leading platform in its field, is delighted to welcome Roland Sanchez-Medina Jr as our exclusively recommended & endorsed Corporate Law expert in the USA. Roland’s office is located in Florida.

Roland Sanchez-Medina Jr. is a partner who focuses his practice in the areas of corporate and securities law, including mergers and acquisitions, corporate structuring/restructuring, board governance, domestic and international commercial transactions, commercial and residential real estate transactions, tax and estate planning, and other general transactional services.

Prior to forming the Firm, Mr. Sanchez-Medina was a partner at the national law firm of McDermott, Will & Emery, where he was a member of the Corporate Department, and was a senior associate at the national law firm of Holland & Knight.

If you require any assistance in this area, please use the contact details provided in Roland’s profile below or contact us at info@leaders-in-law.com & we will put you in touch.

Nixon Peabody names Christopher Keefe to lead the law firm’s Business & Finance Department

Boston, MA. Nixon Peabody LLP is pleased to announce that Christopher Keefe has been selected as head of the AmLaw 100 law firm’s Business & Finance Department, comprised of the firm’s Corporate, Health Care, Global Finance, and Private Clients practice groups.

The more than 200 attorneys in Nixon Peabody’s Business & Finance Department help clients tackle complex transactions in order to better serve their customers and create a positive impact on the communities where they work.

For the past two years, Chris has led Nixon Peabody’s Corporate practice. In his nearly 24 years with the firm, Chris has represented industry-leading companies and funds in financings, corporate counseling, and mergers and acquisitions at all stages, working primarily in the technology, consumer, life sciences, and manufacturing industries as well as with the venture and private equity funds that invest in them.

In his new role, Chris succeeds Stephen Zubiago, who was elected as Nixon Peabody’s CEO and managing partner earlier this year.

“Chris steps into this role amid unprecedented demand in the market, together with the challenges of businesses transitioning back to the office environment,” said Steve Zubiago. “He helps our clients achieve their goals regardless of changing conditions, and he’ll bring that same formula to his leadership of the Business & Finance Department.”

During his Corporate practice leadership, Chris oversaw the addition of high-profile lateral attorneys across practice areas, including tax, fund formation, mergers and acquisitions, cross-border transactions, and employee benefits and executive compensation.

“I am excited for this role, as it not only allows me to remain fully engaged in my practice, but also provides me with an opportunity to help shape the growth and strategic direction of our firm in a new way,” said Chris Keefe. “Our primary goals are to drive the success of our clients and to continue to engage with the communities we serve while becoming stronger, deeper, and more inclusive.”

Chris earned his J.D. from the University of Virginia School of Law and received a B.S.B.A., magna cum laude, from American University.

William McKinley joins Leaders in Law as the exclusive Healthcare Law member in Wisconsin, USA

Leaders in Law, the leading platform in its field, is delighted to welcome William McKinley as our exclusively recommended & endorsed Healthcare Law expert in the USA. William’s office is located in Wisconsin.

Will devotes a large portion of his legal practice towards serving his business and corporate clients, especially those in the medical and dental fields, dealing with contract, real estate, corporate, employment, and sale/acquisition issues.

Will also has significant commercial litigation experience, dealing with a wide variety of cases in small-claims, state circuit, and federal district court, along with the Wisconsin Court of Appeals.  Will has also appeared before the Wisconsin Supreme Court. Will has routinely served as local counsel for large corporations dealing with litigation in courts throughout Northeast Wisconsin.

If you require any assistance in this area, please use the contact details provided in William’s profile below or contact us at info@leaders-in-law.com & we will put you in touch.