Oppose SB 939
Tuesday, June 2, 2020
Posted by: Julia Marin
Our industry strongly opposes SB 939 and we need your help to stop this bill. Help to ensure policymakers and media understand this is a sweeping bill that could abrogate nearly every lease in the state. The bill allows virtually ALL commercial tenants in California to not pay rent for an indeterminate amount of time; the bill also allows certain tenants to walk away from any lease, regardless of the investment put into a space by the building owner. This bill gives new rights to tenants and removes current rights from property owners.
Contact Senators TODAY!
You can find your State Senator HERE
by inputting your address or the address of your buildings.
QUICK POINTS; SB 939 OPPOSE:
* SB 939's rent deferral mandate applies to virtually all leases in the state of California and provides rent deferral for an unknown/extended period of time.
* Many property owners may be forced in commercial mortgage default with no revenue from business renters.
* SB 939 allows restaurants/bars/entertainment venues of any size to walk out on a lease regardless of the amount owed in TI's.
* Many property owners will be forced to assume the debt of major investments in preparing space for tenants.
* SB 939 allows almost all commercial leases to be abrogated and gives tenants new rights and significant leverage.
* In California, a contract may never be a contract again.
* SB 939 criminalizes standard real estate business practices.
* Be careful talking to your tenants about rent obligations -- you may get a fine and slapped with an unfair business practice for doing your job.
* SB 939 trades short term relief for some businesses for mortgage defaults of other businesses and creates long term economic damage.
* All businesses have been impacted by COVID-19 shelter in place orders. Other bills/measures recognize the state has a role to play.
* SB 939 is an outlier from those other measures and unfairly heaps all the responsibility of helping tenants on to you.
MEDIA TALKING POINTS
First Goal of COVID-19 Economic Recovery Should be: DO NO HARM
SB 939 (Wiener) Would Replace a Legitimate Loss in Business Revenue Problem with a Mortgage Default Crisis
* SB 939 is Based on the False Premise that Property Owners Benefit from Evicting Tenants: In Fact, Property Owners Are Far More Motivated to Keep Existing Tenants: Nobody wants an empty building. And trying to find new tenants is far more costly than finding creative ways to keep current tenants.
* SB 939 Seeks to Reduce Rent Amounts Paid by Leasees But Does Nothing to Reduce the Mortgage Payment Still Owed by the Property Owner: Property owners, like businesses and restaurant operators come in all shapes and sizes. But the vast majority rely on rent from their tenants to pay their mortgage, just like restaurants rely on customers to pay their food and beverage tabs.
* SB 939 Will Trigger a Commercial Mortgage Crisis: By unfairly requiring property owners to carry rent for more than a year, and also giving certain tenants the ability to walk away from a lease contract regardless of fiscal impact, SB 939 trades a short term business revenue problem for a long term commercial property foreclosure crisis.