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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

Connecticut’s Paid Family and Medical Leave Program’s Applications Are Now Open

In a press conference on December 1, 2021, Governor Ned Lamont, along with Connecticut Paid Leave Authority Chief Executive Officer Andrea Barton Reeves, announced that the Connecticut Paid Leave Authority is now accepting applications for Connecticut residents who want to participate in the state’s new paid family and medical leave program. Approved applicants will be eligible to receive benefits beginning January 1, 2022.

The Connecticut Paid Leave Authority expects 1,000 – 1,500 applications per day, and indicated the Connecticut Paid Leave Authority is prepared to handle that level of applications.

In its Human Resouces Toolkit, the Connecticut Leave Authority outlines the “process when a worker tells you they’re applying for CT paid leave.”

How Do Employees Apply for Leave?

The Connecticut Paid Leave Authority is partnering with the Connecticut Paid Leave Authority’s benefits administrator to oversee the administration of paid leave benefits claims. Employees may submit applications via the Connecticut Paid Leave Authority’s online portal, telephone, fax, mail, or email. Employees have 15 days from the initiation of a claim to provide all requested documentation and should, according to the state, know their approval status five days after completing the required paperwork.

Employees must notify their employers or their human resources departments at least 30 days prior to the start of leave for foreseen circumstances, and as soon as is practicable for unforeseen circumstances.

Employer’s Role in Application Process

As part of the paid leave application process, employees will need to ask their employers to complete an employment verification form. Employers must complete the employment verification form and return it to the Connecticut Paid Leave Authority’s benefits administrator within 10 days. Employers are also required to notify employees that they may be eligible for Connecticut paid leave benefits whenever they notify their employers of their intent to take leave.

If the Connecticut Paid Leave Authority denies an employee’s claim, the employer is not responsible for filing any documents on the employee’s behalf. Employees may file a request for reconsideration with the Connecticut Paid Leave Authority’s benefits administrator within 10 days of a denial.

Employers may require workers to use vacation days or paid time off before they receive Connecticut paid leave benefits; however, employers must allow employees to retain up to 2 weeks of paid time off while on Connecticut family and medical leave.

Payment

The state will make approved claim payments to employees two weeks in arrears either via a stored value card or by direct deposit. The Connecticut Paid Leave Authority will not issue paper checks.

Article by:
Nicole S. Mulé
Ogletree, Deakins, Nash, Smoak & Stewart, P.C.

Avisen Legal Partner Kimberly Lowe Reappointed to the Commission on Uniform State Laws

Avisen Legal Partner Kimberly Lowe Reappointed to the Commission on Uniform State Laws

Prestigious appointment made by Governor Tim Walz, Chief Justice Lorie Gildea, and Attorney General Keith Ellison

As of June 1, 2021, Avisen Legal partner Kimberly Lowe has been reappointed for a fourth term to the Commission on Uniform State Laws (ULC). The reappointment was initiated by Minnesota Governor, Tim Walz, Minnesota Supreme Court Chief Justice Lorie Gildea, and Minnesota Attorney general, Keith Ellison. We recently had the opportunity to talk with Kim about her work on this important Commission.

Q.  How many two-year terms have you served on the Commission on Uniform State Laws?

A.  I was first appointed in 2016, so I have served 3 terms and this is my 4th appointment. I am very pleased to continue the important work of our Commission and am honored to have been reappointed.

Q.  What are some of the projects you worked on over the past couple of years?

A.  You can visit our website to see the different projects I have been involved in through my work on the Commission on Uniform State Laws.

Q.  What do you enjoy most about your Commission work?

A.  The ULC provides states with non-partisan, carefully conceived uniform laws. The ULC’s work simplifies life for people who live, work, or travel in multiple states and improves local economies by facilitating interstate commerce. Each uniform act is drafted in an open and deliberative process that draws on the expertise of state-appointed commissioners, legal advisors and observers.  As a commissioner, I work with lawyers from around the country on drafting laws and then I come back to Minnesota and work with our law makers to enact these laws.  Clear and practical laws benefit all citizens and I am fortunate to be part of that process.

For more information please read the news release distributed by the ULC.

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.

Washington Joins Chorus of States with Major Environmental Justice Laws

Washington State has joined a growing number of states that have adopted keystone environmental justice laws. On May 17, 2021, Governor Jay Inslee signed the Healthy Environment for All (HEAL) Act, E2SSB 5141, into law.

The new law recognizes that many communities experience disproportionately greater environmental health impacts as a result of multiple social, economic, and environmental stressors. Its principal objectives are to reduce and eliminate these disparities and to “remedy the effects of past disparate treatment of overburdened communities and vulnerable populations.” The law builds on recommendations in a 2020 report prepared by a state-funded environmental justice task force.[1] Over the next several years, the legislation will inject environmental justice considerations into state administrative agency actions. These considerations are likely to affect a range of agency activities and initiatives from grant programs and rulemaking to project approvals and enforcement cases.[2] 

Key Takeaways

Several state agencies, including the Department of Ecology, will be required by the law to:

  • Adopt environmental justice principles into their strategic planning and budgeting and funding decisions.
  • Develop and implement a community engagement plan with a focus on empowering overburdened communities and vulnerable populations, and on considering them in agency decision-making.
  • Consult with Indian tribes on decisions affecting tribal rights and lands and when carrying out certain agency environmental justice obligations.
  • Develop metrics and reports for tracking progress toward environmental justice goals.[3] 

For members of the regulated community, the most salient aspect of the law likely will be environmental justice assessment requirements. By July 1, 2023, covered state agencies must develop a process for conducting environmental justice assessments for “significant agency actions.” Based on these assessments, the agencies must seek “to reduce or eliminate the environmental harms and maximize the environmental benefits created by the significant agency action on overburdened communities and vulnerable populations” to the extent “feasible and consistent with the underlying statute being implemented.” Even if the law does not expand agency authority, these assessments are likely to influence regulatory requirements and, ultimately, how the agencies administer and enforce their programs.

Environmental Justice, Overburdened Communities, and Other Critical Concepts

At the heart of the law are several foundational concepts with which environmental attorneys and their clients should become familiar. The first, naturally, is “environmental justice,” defined as:

the fair treatment and meaningful involvement of all people regardless of race, color, national origin, or income with respect to the development, implementation, and enforcement of environmental laws, rules, and policies. Environmental justice includes addressing disproportionate environmental and health impacts in all laws, rules, and policies with environmental impacts by prioritizing vulnerable populations and overburdened communities, the equitable distribution of resources and benefits, and eliminating harm.

Although derived in part from an EPA definition that addresses the procedural aspects of environmental regulation, the state’s definition incorporates outcome-based components.

The law also includes other definitions to assist with identifying relevant environmental benefits and harms, as well as the communities experiencing the disproportionate environmental and health burdens that the law seeks to remedy. For example, “overburdened communities” are “a geographic area where vulnerable populations face combined, multiple environmental harms and health impacts, and includes, but is not limited to, highly impacted communities ….”

A critical piece of the state’s environmental justice program will be an “environmental health disparities map,” which the Department of Health is charged with maintaining.[4] The map must use up-to-date information and data to identify “cumulative environmental health impacts and overburdened communities.” The map is likely to play a primary role in efforts to implement the state’s environmental justice initiatives by identifying relevant communities and impacts.[5]

Environmental Justice Assessments

The scope, methods, and applicability of agency environmental justice assessments for significant agency actions will be shaped over the next several years by each agency, an interagency workgroup, and a soon-to-be established environmental justice council.[6] A “significant agency action” is defined broadly as an “action that may cause environmental harm or may affect the equitable distribution of environmental benefits to an overburdened community or a vulnerable population.” As a starting point, the law identifies certain rulemaking, large capital and transportation projects, and agency legislation requests as significant agency actions. But, after considering guidance from the environmental justice council and interagency workgroup, agencies can define additional agency actions that would trigger environmental justice assessments.

Similarly, the content of the environmental justice assessments will be clarified through agency action over the next couple of years. As a baseline, the law requires the assessments to:

  • “Where applicable, utilize cumulative environmental health impact analysis … that considers the effects of the proposed action.”
  • Identify “overburdened communities and vulnerable populations who are expected to be affected … and the potential environmental and health impacts.”
  • Identify impacts to tribal rights and resources.
  • Consider community input and describe how environmental justice communities may become involved in the development of the action.
  • Identify “options … to reduce, mitigate, or eliminate identified probable impacts on overburdened communities and vulnerable populations, or provide a justification” for not addressing those impacts.

The law reigns in the potential scope of environmental justice assessments by specifying that they should resemble the familiar State Environmental Policy Act checklists that agencies use to evaluate environmental impacts for countless projects. The law also states that the checklist is not intended to be “a comprehensive or an exhaustive examination of all potential impacts” and does not require “novel quantitative or economic analysis” of the proposed agency action.

Pending the outcome of the assessments, agencies then must attempt to minimize or avoid “environmental harm” and “maximize the environmental benefits” for “overburdened communities and vulnerable populations.” The law specifies several “methods” that the agencies must consider “consistent with agency authority, mission, and mandates,” including, among others:

  • Eliminating “disparate impact of environmental harms.”
  • Reducing cumulative health impacts.
  • Providing for “equitable participation and meaningful engagement” of impacted communities in the development of the agency action.
  • “Prioritizing equitable distribution of resources and benefits.”
  • Providing “positive workforce and job outcomes.”
  • “Modifying substantive regulatory or policy requirements.”

The law contemplates that “other mitigation techniques” will be developed by the agencies as well based on input from a range of sources, such as the environmental justice council and “representatives of overburdened communities and vulnerable populations.”

The environmental justice assessment process also will provide grounds for challenging agency actions.  Future agency determinations about what constitutes a significant agency action will be particularly important in determining the extent to which these challenges are premised on environmental justice issues.

Conclusion

The Healthy Environment for All Act will spur additional action to address environmental justice issues in Washington. To date, state agencies have incorporated some environmental justice principles into programmatic planning and funding decisions. The new law will shape agency actions across a spectrum of areas. During the legislative process, the potentially more far-reaching mandates of earlier bill versions were watered down. However, as agencies take steps to implement the law over the next several years, members of the regulated community – particularly, those that interact with the Department of Ecology – should anticipate that environmental justice principles will increasingly affect general regulatory requirements and are likely to play a more substantial role in facility-specific enforcement, permitting, and compliance issues. Businesses located in overburdened communities and/or vulnerable populations, in particular, should be prepared to track implementation efforts to determine proactively how environmental justice factors could affect their operations.


[1] The Environmental Justice Task Force was required to provide a report to the Governor and the legislature by October 31, 2020, with recommendations for incorporating environmental justice principles into state agency actions. The task force was funded through a budget proviso for the Department of Health in ESB 1109.

[2] In addition to the HEAL Act, the Washington State legislature recently passed E2SSB 5126, a greenhouse gas “cap and invest” law, which includes significant environmental justice provisions. The environmental justice provisions in that legislation will be evaluated in a separate news alert.

[3] State agencies that are not required to comply with the environmental justice law may choose to do so.

[4] The Department of Health has already developed an initial version of the map. It incorporates measures such as diesel emissions, ozone, and proximity to hazardous waste sites and their relationship to communities experiencing higher rates of poverty and certain health issues, like cardiovascular disease.

[5] By November 2022, the Washington State Institute for Public Policy, a non-partisan public research group, must evaluate the “measures and methods” in the environmental health disparities map and issue a report on its findings.

[6] The environmental justice council will have several non-binding functions: providing a public forum for hearing and learning about environmental justice concerns; and developing guidance on agency environmental justice implementation, environmental justice assessments, and health disparities mapping; evaluating agency progress in applying guidance from the council; and developing recommendations for additional legislative action to address environmental justice issues. The advisory council will include 14 members appointed by the Governor. The interagency workgroup will offer technical assistance and information-sharing services to advance agency implementation and evaluation of the environmental justice requirements and will share information about specific agency functions and activities to support the council’s guidance and assessment responsibilities.

Article by

Stacey Sublett Halliday
Julius M. Redd
Allyn L. Stern
Augustus E. Winkes
Beveridge & Diamond PC

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.