Update: The Impact of COVID-19
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Dominium has been focused on our business and operations during this pandemic crisis. As we move past the critical rent collection part of each month, we will focus our updates on information that we have found useful in the work we are doing. We hope that our friends and partners in affordable housing find it helpful as well and will send other information our way as well. A collection of all previous updates can be found at
COVID-19 Impact Update
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Dominium Rent Collection Report: Through June 8, 2020 we have collected 85% of charges for the month.
- Cumulative receipts are down (1%) compared to May through the 8th.
- Cumulative receipts are up 4% compared to July 8th, 2019, the most recent month with the 1st falling on a Monday.
In terms of types of properties or receipts:
- Resident receipts are at 85%, which is relatively flat compared to May through the 8th and up 3% compared to July 8, 2019.
- Subsidy receipts are at 87%, which is down (7%) compared to May through the 8th and up 7% compared to July 8, 2019.
- Senior total receipts are 94%, which is up 1% compared to May through the 8th and up 2% compared to July 8, 2019.
- Family total receipts are 83%, which is up 1% compared to May through the 8th and up 2% compared to July 8, 2019.
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The chart below shows the distribution of properties on their collection performance in June through the 8th. Out of the 210 properties, 32 have collected less than 65% of June charges representing
$0.5M
remaining to collect while 55 properties have collected over 91% representing
$0.4M
remaining to collect.
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The lowest collection category is primarily made up of Section 8 properties which are impacted by timing with changes between resident and subsidy owed charges. The below distribution excludes these properties and follows the expected trends.
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Previous Dominium Rent Reports can be found
here.
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Finance & Commerce reports on
the state of Minnesota’s construction industry as a result of COVID-19. Many projects are being delayed or cancelled and many workers are furloughed as a result. The Minneapolis Federal Reserve conducted a survey of 500 firms in the Twin Cities. There is less work from contractors, and many firms are reducing staff or cutting wages. Regional outreach director for the Federal Reserve Bank in Minneapolis cautioned that there may not be a quick recovery, but a gradual one driven by consumer demand.
Minnesota is below the national average unemployment rate during the pandemic and is faring better than its neighboring states. This follows Minnesota trends in the past as Minnesota is usually below the national unemployment rate due to the diversified economy in the state. What remains unknown is whether it will follow trends from the 2008 crisis recovery or not.
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The New York Times reports that the
protests for George Floyd's murder could cause a resurgence in COVID-19 cases. The protests are drawing large crowds causing some to contemplate their attendance, whereas others are willing to risk their health to protest. Due to the unknowns surrounding COVID, the \of these are gatherings on the spread of the virus will not be known for several weeks.
Anthony Fauci is optimistic about several vaccine candidates that are proving to be successful. These vaccines could arrive "within a reasonable period of time." It is still unknown the effectiveness of such a vaccine and how long it will provide protection from the virus. Priority will likely be given to health care workers, the elderly and those with underlying health conditions.
Dr. Michael Osterholm discusses issues with testing data, indirect consequences of the COVID-19 pandemic, and his experience co-hosting a webinar with the Minneapolis Federal Reserve Bank titled, “
Living in a COVID-19 world” in last week’s episode of the
Osterholm Update: COVID-19.
Marsh McLennan has released their
Pandemic Risk Protection Report that outlines the risks of pandemics, makes a case for public-private partnerships, and suggest what could be included in a government-backed solution. The report also illustrates disruptions of COVID-19, showing that manufacturing, health care, retail, entertainment and recreation, and food, beverage, and hospitality industries have suffered the largest disruption. Marsh calls on the insurance industry to play a role in the public-private risk solution.
As more data has become available in the US, Vox is reporting on
the likelihood of death by COVID-19 while examining the case fatality rate. They state that case fatality rate isn’t that useful as we are missing cases and missing deaths since testing has not been widely available. Based on a sample of antibody tests of people going to the grocery store, twenty percent of people in New York have tested positive, but this cannot yet be compared to the entire population of the city. They state that we won’t know the full death toll until this pandemic ends.
The CDC’s
tracker
of confirmed cases of and deaths from COVID-19 across the US provides the most up to date information on the spread of the virus.
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Economic &
Employment News
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The New York Times reports that
unemployment fell to 13.3 percent in May, with 2.5 million jobs being gained, after many economists had forecasted the unemployment rate to reach as high as 20%. This is down from 14.7% in April. Many of the jobs gained were recovered in the leisure and hospitality and restaurant and bar sectors, and the article notes that the unemployment rate continued to rise for black workers.
The Wall Street Journal reports that the
CBO has released new interim projections for the next decade, which revises projections made pre-COVID. The projections estimate a $15.7 trillion decrease in nominal GDP over the next decade, $7.9 trillion after adjustments to inflation. They project that the GDP will recover to the path it was on pre-covid as late as 2029.
Suntrust Bank distributed their
Weekly Interest Rate Commentary. The note the continuing concerns for a US-China trade war due to China’s actions in Hong Kong and possible sanctions. Also, US personal spending in 2008 during the financial crisis dropped 1.4%, whereas during COVID-19 it has dropped 13.6%.
CoStar details that consumers are hopeful for an economic recovery. Personal spending has declined substantially, thus allowing households to save new income. However, they note that this won’t last as additional benefits from the government unemployment expire in July. CoStar also notes hiring has improved 21% since its lowest drop during the pandemic.
Washington Business Journal details the
new changes to the Small Business Administration’s Paycheck Protection Program. The House of Representatives passed the bipartisan Paycheck Protection Program Flexibility Act of 2020 on May 28th that “extends the eight-week period under which loan recipients can spend the PPP money.” The bill focuses on restaurants, retailers and other businesses. The legislation, signed by the President, allows more time for small business to rehire employees, extends the amount of time a business can apply for loan forgiveness, and expands the use of PPP funds to nonpayroll expenses to 40% instead of 25%, among other benefits.
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IHME’s COVID-19
Projections page shows trends and projections of deaths and hospital resource usage. The graph on the right shows their projection for daily infections and testing:
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Other Interesting & Helpful Resources
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NBA owners voted on June 4th to resume the season on July 31st with 22 teams. All games will be played at Walt Disney World in Florida. By a vote of 29-1 the single-site proposal was ratified. At the time of publication by the New York Times article, it was not clear if the players would get to vote on the proposal. To be included within one of the 22 teams, the team needs to have been within 6 games of making the playoffs as of March 11th.
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State-by-State Actions
Reopening Status:
Construction Limits:
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Resident Resources
Freddie Mac offers a
Renter Helpline, which provides counseling for renters on budgeting, credit improvement and debt management. The attached flyer is available in multiple languages.
HUD has put together a
guide and FAQ for Renters during the pandemic.
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In an attempt to share what we know and are doing during this crisis, we are publishing a set of periodic updates for our partners and friends in affordable housing. We likely will do this twice a week or as interesting events dictate. Please let us know if you would like to be removed from this list.
Thank you,
Paul Sween & Mark Moorhouse
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