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    Newsletter— Real Estate

    Real Estate

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    Robert C. Herr
    Partner
    San Francisco   
    +1.415.983.1000
    2/10/2014
    IRS Issues Long-Promised Guidance Following Historic Boardwalk Decision
    Author: Thomas D. Morton
    To welcome in the new year, the Internal Revenue Service (the “IRS”) issued Rev. Proc. 2014-12, 2014-3 I.R.B. 415, to provide administrative guidance to the federal historic tax credit industry in the aftermath of the Third Circuit’s decision in Historic Boardwalk Hall, LLC v. Commissioner, 694 F.3d 425 (3d Cir. 2012), cert. denied, 133 S.Ct. 2734 (2013). Rev. Proc. 2014-12 includes a safe harbor (the “Safe Harbor”) pursuant to which the IRS will not challenge the allocation of rehabilitation tax credits (“Historic Credits”) under Section 47 of the Internal Revenue Code of 1986, as amended (the “Code”), among partners in a partnership. Overall, the guidance is a good faith and useful attempt by the IRS to set reasonable Safe Harbor parameters while addressing its concerns with the deal structure in the Historic Boardwalk case. Unfortunately, it does also include some puzzling elements.
    6/27/2013
    Perspectives on Real Estate
    Authors: Thomas Klaus Gump, George P. Haley, Lynn A. Soukup
    This issue of the newsletter examines amendments to Article 9 of the Uniform Commercial Code (UCC), which will become effective in many jurisdictions on July 1, 2013.
    6/26/2013
    Perspectives on Real Estate
    Author: Roberto P. Garcia
    This issue of the newsletter examines Maryland’s recordation and transfer tax exemption for transfers of real property between related entities becoming available to limited liability companies, effective July 1.
    6/20/2013
    Perspectives on Real Estate
    Author: James P. Bobotek
    This issue of Perspectives on Real Estate discusses what to look out for in order to ensure adequate coverage against property and business interruption losses in the wake of natural disasters.
    05/31/2013
    Perspectives on Real Estate
    Author: Geoffrey J. Greeves
    This issue of Perspectives on Real Estate discusses what to look out for in order to ensure adequate coverage against property loss.
    05/06/2013
    Perspectives on Real Estate
    Author: Roberto P. Garcia
    This issue of the newsletter examines the impact of the Stormwater Remediation Fee in Maryland and the Regional Congestion Relief Fee in Virginia, effective on July 1, on residential and commercial property owners.
    2/15/2013
    Catching Up with Winding Down: The Status of California Redevelopment Successor Agencies
    Authors: Robert C. Herr, Noa L. Clark, Paul C. Levin
    Successor agencies to California’s dissolved Redevelopment Agencies (“RDAs”) continue to wind down the operations of the former RDAs under the supervision of oversight boards pursuant to Assembly Bill X1 26 (“AB 26”) as modified by Assembly Bill 1484 (“AB 1484”). Successor agencies are currently addressing several issues for the first time relating to enforceability of contracts, the distribution of agency funds, and the future of properties formerly owned by RDAs. This advisory explains the current state of successor agencies and how successor agencies are dealing with issues raised by the wind-down process.
    2/4/2013
    Trends in Single-Family Housing
    Authors: Craig A. deRidder, Peter G. Freeman, Joseph T. Lynyak, III
    Rising home values in many areas of the country and improved economic data have buoyed hopes that the recession may be behind us, but no one expects an immediate return of either pre-2007 home value appreciation or the loose mortgage underwriting and servicing standards that were exposed during the housing crash. Not only have federal regulators issued numerous rules to prevent another housing-based recession, but many communities still face a daunting inventory of distressed single-family housing.
    Fall 2012
    Perspectives on Real Estate
    Authors: James P. Bobotek, Samuel S. Cavior, Eric A. Kremer, Dana Proud Newman, Carmela D. Nicholas, Deryck A. Palmer
    The 22nd edition of Pillsbury's Newsletter: Perspectives on Real Estate features articles on energy consumption data reporting (AB1103 and 531), construction and risk management, new foreign tax withholding forms, chapter 9 and public-private partnerships.
    9/10/2012
    Lenders Beware: Default Interest Provisions Within Acceleration Clauses Are Not Automatically Triggered by Maturity
    Authors: Steven D. Hamilton, Angela M. Yates
    The Court of Appeals of the State of California, Second Appellate District has ruled that because the default interest provisions of a promissory note were included within the acceleration clause of a promissory note, the default rate was not triggered when the promissory note matured by its terms. Based on this ruling, default interest provisions in promissory notes should provide that the default interest rate applies not only following a default or acceleration of the maturity date, but also after the scheduled maturity date.
    August 2012
    Shutting Down the Construction Project
    Authors: Noa L. Clark, Robert A. James, Amy L. Pierce
    Trouble, in the form of adverse changes in financial conditions or the property marketing environment, sometimes strikes urban real estate development projects during the period between construction contract signing and completion of procurement and construction activities. In many cases, the course of action that will maximize value for all stakeholders is to allow the work to continue. Project completion will result in improvement to a base level and more security from casualty risks, as well as satisfaction of the conditions from a seller or redevelopment agency to drawdown of the land rights. But if financing for that continuation is not available, or if prospects for selling or leasing the improved property appear sufficiently bleak, the developer may reluctantly determine that the construction contracts and work should be suspended for some period of time or terminated altogether.
    5/16/2012
    Significant Changes to California's Mechanics Lien Law Coming July 1, 2012
    Authors: Chris R. Rodriguez, William S. Hale, P.E., Robert A. James, Amy L. Pierce, John S. Poulos
    Effective July 1, all of the existing statutes governing mechanics liens, stop notices and payment bonds in California will be repealed and replaced by updated statutes.

    May 2012
    Project Finance in Iraq, Part 1: Project Ownership
    Source: Iraq Perspectives Newsletter  - May 2012
    Authors: Christopher D. Gunson
    Iraq is recovering from decades of war, sanctions and domestic unrest, and the country is in urgent need of all types of infrastructure—including power, manufacturing, transportation, telecommunications, housing, healthcare, and water. With Iraq's oil production and exports on the rise, Iraq is now in a position to move forward with these projects, for which it will need significant foreign investment. In this article, the first in a series, we consider some of the key issues involved in project finance in Iraq, particularly with respect to the challenges associated with land ownership by foreign investors and the impact that this has on project finance structures.

    May 2012
    Iraq Perspectives Newsletter
    Authors: David J. Cynamon, Christopher D. Gunson, Craig A. deRidder, Mostafa El-Erian, Esq.
    Introduction to Iraq Perspectives
    This is the first issue of Iraq Perspectives, a newsletter by Pillsbury Winthrop Shaw Pittman LLP on important legal issues regarding Iraq. Iraq Perspectives is written for companies and individuals who are interested in investment and development opportunities in Iraq.

    May 2012
    Iraq's National Investment Commission
    Source: Iraq Perspectives Newsletter - May 2012
    Authors: Mostafa El-Erian, Esq.
    The Investment Law of 2006 established the National Investment Commission (NIC), the Iraqi government institution responsible for promoting investment by granting licenses to develop major projects. The NIC actively assists investors to identify potential projects and coordinates on behalf of investors with Iraq's ministries and government agencies. For investors seeking to do business in the country, the NIC has established a One-Stop Shop (OSS) for navigating Iraq's complex bureaucracy, including clarification of the rights and responsibilities of central and provincial agencies.

    Spring 2012
    Perspectives on Real Estate
    Authors: Noa L. Clark, Jeffrey R. Gans, Robert C. Herr, Eric A. Kremer, James S. Lloyd, Carmela D. Nicholas, Paul C. Levin
    The 21st edition of Pillsbury's Newsletter: Perspectives on Real Estate features articles on green leasing, mineral rights, avoiding construction project failures and California's post redevelopment agency landscape.

    Spring 2012
    "Green" Leasing: Landlord and Tenant Perspectives
    Source: Perspectives on Real Estate Newsletter - Spring 2012
    Authors: Eric A. Kremer, Carmela D. Nicholas
    As the global emphasis on carbon footprint reduction and sustainability measures continues to increase, so will the prevalence of "green" provisions in commercial leases. For both landlords and tenants, business, marketing and public relations reasons are as likely as environmental interests to drive the "green" lease trend. From the landlord's perspective, a building that achieves a certain sustainability rating may have a competitive marketing advantage over buildings that have not achieved "green" status, and the implementation of environmentally friendly measures such as installation of energy-efficient LED lights may serve to reduce operating expenses for a property. A recent study showed that buildings that are certified under the U.S. Green Building Council's Leadership in Energy and Environmental Design ("LEED") rating system command higher rents and have greater occupancy rates than non-LEED-certified buildings.1 Landlords are also faced with new federal, state and local regulations that may require compliance with "green" initiatives, such as the requirement to recycle construction waste from tenant improvement installations.

    Spring 2012
    Scratching the Surface: Understanding the Potential Impact of Minerals Rights on Your Texas Loan
    Source: Perspectives on Real Estate Newsletter - Spring 2012
    Authors: James S. Lloyd
    Texas oil and gas law presents unique issues for real estate secured lending. In Texas, the mineral estate can be severed from the surface estate, resulting in a separate fee estate with rights to use the surface for purposes of exploring and extracting minerals. Over the past decade, energy prices, combined with new technologies such as hydraulic fracturing, have resulted in increased exploration and development in urban areas, typified by the Barnett Shale play in North Texas. Lenders should be aware of the potential impact of such exploration and development on their real property collateral.

    Spring 2012
    Avoiding Construction Project Failures: 8,000 Romans, 3,000 Greeks, One Lesson
    Source: Perspectives on Real Estate Newsletter - Spring 2012
    Authors: Jeffrey R. Gans, John A. Fedun
    Over two days in 279 BC, Rome fought a bloody battle at Asculum against the Grecian-allied armies of Tarantine, Oscan, Samnite and Epirote. As with all important battles (ancient and modern), the Battle of Asculum was part of a war for control over an enormous parcel of prime real estate on the southern Italian coast known at the time as Magna Graecia. Those miles of waterfront property with no zoning restrictions and deepwater access were coveted by every developer from Macedonia to Gaul.

    Spring 2012
    California's Post Redevelopment Agency Landscape
    Source: Perspectives on Real Estate Newsletter - Spring 2012
    Authors: Noa L. Clark, Robert C. Herr, Paul C. Levin
    On December 29, 2011, the California Supreme Court upheld legislation that fundamentally changes redevelopment law in California. The court upheld Assembly Bill X1 26 (AB 26), eliminating all redevelopment agencies in California, while overturning Assembly Bill X1 27 (AB 27), which would have allowed redevelopment agencies to continue operations if the agencies made certain payments to the state. As a result, all of California's approximately 400 redevelopment agencies dissolved as of February 1, 2012, without the option to make payments to the state to continue operations.

    2012
    Real Estate Big Deal Brochure
    Every real estate deal is big for someone. We have done deals of all sizes, up to millions of square feet and several billion dollars in market value. But it's not the size that makes them big. We have worked on projects that spanned the entire country. But it's not the geographic scope that matters to us. We work regularly with some of the best-known buyers, sellers, developers, builders, lenders and investors in the country. But we aren't looking to ride on the reputations of others. What makes a big deal big for us is the difference it makes for you.

    1/4/2012
    State Supreme Court Upholds Dissolution of California Redevelopment Agencies
    Authors: Robert C. Herr, Noa L. Clark, Paul C. Levin
    On December 29, 2011, the California Supreme Court issued a ruling upholding sweeping changes to California redevelopment law. The court upheld Assembly Bill (AB) X1 26, which dissolves all redevelopment agencies in California, while invalidating ABX1 27, which would have allowed redevelopment agencies to continue by making required payments to the state’s education fund. This ruling means that, effective immediately, all redevelopment agencies in California must begin the dissolution and winding-up process as required by ABX1 26.
    10/19/2011
    Texas Seeks Private Development Partners
    Authors: Laura E. Hannusch, James S. Lloyd
    Effective September 1, 2011, the Texas Legislature enacted the Public and Private Facilities and Infrastructure Act (the Act) for the purpose of enabling private investment in public facilities and infrastructure. The Texas Facilities Commission (the Commission) recently adopted Public-Private Partnership Guidelines (the Guidelines) setting forth the application requirements for qualifying projects and the review criteria and processes by which applications will be evaluated. The Guidelines are intended to provide certainty to the process of proposing and negotiating public-private partnerships (PPPs), which in turn should result in additional development opportunities to private parties while better utilizing and developing the State of Texas’ (the State) real estate assets and providing the State with non-tax revenue sources.
    10/19/2011
    Shifting of Liability Nixed by New California Contractor's Law
    Authors: John R. Heisse, Robert A. James, Chris R. Rodriguez
    After January 1, 2013, under new California law, "Type I" indemnity provisions covering the indemnitee's concurrent active negligence will no longer be enforceable, and owners' and contractors' ability to shift the costs of defense to downstream subcontractors and suppliers will be limited.

    10/18/2011
    Prevailing Wage Law in California to Cover Certain Private Renewable and Energy Efficiency Projects on Public Land
    Authors: Robert A. James, Amy L. Pierce, Matt Hallinan
    New California law expands the definition of "public works," imposing prevailing wage obligations for construction, alteration, demolition, installation and repair work performed under certain private contracts in connection with renewable energy or energy efficiency improvements on public property. New California laws also stiffen the penalties for non-compliance and modify the enforcement mechanisms for prevailing wage obligations.

    10/10/2011
    LLCs Can Finally Become Licensed California Contractors
    Authors: Robert A. James, Amy L. Pierce
    California law directs the Contractors’ State License Board, no later than January 1, 2012, to begin processing applications by limited liability companies for contractors’ licenses. The Board has recently provided guidance on the licensing requirements for LLCs, which differ from those for other types of business organizations.
    10/4/2011
    California Commercial Property Owners Face Deadline for Energy Benchmarking Disclosures
    Authors: Laura E. Hannusch, Quinn A. Arntsen, Paul C. Levin
    The California Energy Commission (CEC) recently issued revised draft regulations setting the implementation schedule for its energy use disclosure program under AB 1103. Under the implementation schedule, commercial real estate owners must disclose energy benchmarking data starting on: July 1, 2012, for buildings with more than 50,000 square feet; January 1, 2013, for buildings with 10,001-49,999 square feet; and July 1, 2013, for buildings with 5,000-10,000 square feet.
    8/19/2011
    P3 Update for California Transportation Projects: Appellate Decision Helps Pave Way for Current and Future Projects
    Authors: Philip Jonathan Tendler, Paul C. Levin
    The Presidio Parkway Project, California’s first public-private partnership (“P3”) to move forward under legislation enacted in 2009, is expected to proceed after a California appellate court denied a request to enjoin the project. Filed on August 8, the decision upheld a lower court ruling dismissing a claim that the project did not meet the requirements of California’s P3 transportation authorization statute.1 This is significant not only for the Presidio Parkway Project, but also because the legislation applicable to this project is the blueprint for structuring eight other pending transportation projects with a total estimated cost of $25 billion.2
    Summer 2011
    Perspectives on Real Estate
    Authors: Glenn Q. Snyder, Kimberly C. Moore, Jeffrey A. Knight, Daniel S. Herzfeld, Josephine S. Lo, Ignacio Barandiaran, H. Carl Moultrie III, William A. Wilcox Jr.
    Welcome to the Summer 2011 edition of Pillsbury’s Perspectives on Real Estate. We decided to focus this edition on public-private partnerships (PPPs) because so many of our clients are involved in these ventures. Typically, PPPs are partnerships between a governmental entity and one or more private parties, specially created to design, build, operate and maintain public projects—such as roads, power plants, hospitals or schools—or some combination of these activities. PPPs also may be viewed in a broader context, to include such things as affordable housing projects (where tax credits make the projects economically feasible) or urban infill projects made possible because of tax increment financing and other financial support from local redevelopment agencies.
    6/2/2011
    Texas Eminent Domain Laws Get a Makeover – A Primer on Senate Bill 18
    Authors: Laura E. Hannusch, Brad Raffle, Joseph R. Herbster
    The Texas Legislature has enacted Senate Bill 18, a law that substantially changes eminent domain practices for both public and private entities. The new rules will most certainly make condemnations more time-consuming and costly. Depending on how courts react to the new focus on takings being solely for a public use, condemning authorities may find themselves having to defend a taking more vigorously than ever before.
    8/2/2010
    New ADA Regulations Update Standards and Broaden Requirements for Public Accommodations
    Authors: Christine Nicolaides Kearns, Joanna Liberman
    On July 23, just days before the 20th anniversary of the passage of the Americans with Disabilities Act ("ADA"), the U.S. Department of Justice announced a new final rule to revise substantially and expand its existing regulations implementing Title III of the ADA. Entities covered by Title III, which include virtually all businesses open to the public, must be aware of these changes to ensure that their facilities and practices do not violate the new requirements.
    June 2010
    Protecting Hard-Won Assets During the Downturn

    “The area around New Carrollton Station has long been considered an ideal candidate for redevelopment because it serves as a commuter hub and a gateway to Washington for travelers coming from the north and east.”

    The Washington Post
    Spring 2010
    Perspectives on Real Estate
    Authors: Noa L. Clark, Amy L. Pierce, Emily K. Bias, Christine A. Scheuneman, Patrick J. Potter, Jerry L. Hall, Wendelin A. White, Thomas V. Loran III, Craig A. Barbarosh, Rhina M. Roberts, Susan E. Michelich
    The 18th edition of Pillsbury's Newsletter: Perspectives on Real Estate features articles written by Pillsbury attorneys from practice groups across the firm including Real Estate, Insolvency & Restructuring, Corporate & Securities and Litigation.
    4/26/2010
    Pillsbury Guides Chinese Investment Group Through Its First U.S. CMBS Transaction
    The OpportunityA Chinese real estate investment group was considering its first investment in the U.S. commercial real estate market. It identified a 5,000-unit apartment project in Texas and Maryland that satisfied its investment parameters, but the project was in the midst of the prior owners’ complex Chapter 11 proceeding—the borrowers’ equity had been wiped out, the assets were encumbered by multiple layers of CMBS debt, and the appointed Special Servicer was actively scrutinizing any proposed restructuring transaction.
    1/19/2010
    Contractor Must Report Nonobvious Hazards Even If It Did Not Create Them
    Authors: Amy L. Pierce, Wesley C. J. Ehlers,  Amanda G. Alley
    California’s First District Court of Appeal in Suarez v. Pacific Northstar Mechanical, Inc., found that Cal-OSHA provisions, Labor Code §§ 6304.5 and 6400, “impose a duty on each employer, at a multiemployer worksite, to report all nonobvious hazards about which the employer learns because its employees were exposed to them during the course of their work, even if the employer in question did not create the hazard.”
    Winter 2009
    Perspectives on Real Estate
    Authors: Scott E. Barat, Emily K. Bias, James P. Bobotek, Noa L. Clark, Jerry L. Hall, Robert C. Herr, Patrick J. Potter, Sukhi Walia, William S. Waller, Wendelin A. White, Rosemarie Oda, Susan E. Michelich, David Tabibian, Mark N. White, David S. Houston
    The 17th edition of Pillsbury's Newsletter: Perspectives on Real Estate features articles written by Pillsbury attorneys from practice groups across the firm including real estate, insolvency, corporate & securities and litigation.
    December 2009
    WebEx Communications: Keeping Airline Executives Up at Night
    WebEx founders Subrah Iyar and Min Zhu had an elegant idea: develop an on-demand application that replaced cumbersome and proprietary videoconferencing equipment with a web browser and a telephone. They planned to tap into the best engineering talent in Silicon Valley and Shanghai, and beat the competition to the most attractive global markets by establishing a local sales presence early on.
    7/9/2009
    CA Court of Appeal Confirms Unlicensed Subcontractor’s Workers May Assert Wage Claims Against General Contractor
    Authors: Amy L. Pierce, Meredith E. Nikkel
    In Sanders Construction Company, Inc. v. Cerda, 2009 DJDAR 9714, issued June 29, 2009, the Fourth District Appellate Court confirmed that, by operation of Labor Code § 2750.5, an unlicensed subcontractor’s workers are statutory employees of the general contractor, which may obligate it to pay their wages.
    6/29/2009
    REMIC Reform Proposals Intended to Ease Effects of Stalled Credit Markets
    Authors: Peter G. Freeman, H. Carl Moultrie III
    As maturity dates for billions of dollars in commercial mortgage loans approach and borrowers worry that refinancing will be difficult, if not impossible, Congress and the IRS reportedly are considering modifications to the rules governing real estate mortgage investment conduits (REMICs) used to structure commercial mortgage-backed securities (CMBS). The proposed reforms would facilitate, among other things, the restructuring of commercial mortgage loans before they are transferred to “special servicing” due to a default or a reasonably foreseeable default.
    6/9/2009
    PPIP and TALF Evolve to Reflect Market Changes
    Authors: Peter G. Freeman
    The Federal Deposit Insurance Corporation’s June 3 announcement of the postponement of the Legacy Loans program, which was a key component of the Treasury Department’s Public Private Investment Program (PPIP), is not expected to slow the Obama administration’s effort to stimulate credit markets through the use of FDIC-guaranteed debt and government equity. The other component of PPIP—the Legacy Securities program—is in the latter stages of development, and the Term Asset-Backed Securities Loan Facility (TALF) has generated significant interest from investors looking for favorably priced debt to acquire asset-backed securities (ABS).
    4/15/2009
    Plan Transfer and Recordation Taxes Correctly When Property Values Fall
    Authors: R.J. Davis, Emily K. Bias
    Many Authorities are Basing Taxes on the Assessed Value When Property is Purchased at Distressed Prices.
    Spring 2009
    Perspectives on Real Estate
    Special Edition: Purchasing Distressed Notes
    Authors: William C. Bowers, Marjorie Fisher Gannett, Peter G. Freeman, Jerry L. Hall, Laura E. Hannusch, Robert (Robin) C. Jones, Jr., Elizabeth Vella Moeller, Dana Proud Newman, Patrick J. Potter, Glenn Q. Snyder, Christina Cole, Michael G. Silver, H. Carl Moultrie III, Susan Ormand Berry
    4/3/2009
    California Appellate Court Confirms that Certain Construction Managers Need Not Be Licensed Contractors
    Authors: Robert A. James, Amy L. Pierce, Eric R. Ostrem
    In a March 30, 2009 decision, California’s Second District appellate court concluded that the Legislature had not defined the term "contractor" to include construction managers who take responsibility for many aspects of construction project management, but who stop short of undertaking the actual modifications to real property.  As such, these construction managers are not required to hold a contractor’s license.
    4/3/2009
    Contractors and Material Suppliers Gear Up for Possible Changes to California’s Mechanics Lien Laws
    Authors: Amy L. Pierce
    Contractors and material suppliers gear up for possible changes to Mechanics Lien Laws which, if unheeded, could result in the forfeiture of contractors’ and material suppliers’ mechanics lien rights.
    3/24/2009
    U.S. Department of Defense Outlines Plans for $7 Billion in Economic Stimulus Spending
    Authors: Jeffrey A. Knight, Lee C. Carter, Yann H.H. van Geertruyden
    On Friday, March 20, 2009, the U.S. Department of Defense released a report detailing how it intends to spend the $7.4 Billion allocated to the department in the American Recovery and Reinvestment Act of 2009.
    12/16/2008
    New California Law Fosters Compliance with Existing Building Accessibility Standards
    Authors: Amy L. Pierce, Chris R. Rodriguez, Greg Johnson, Meredith E. Nikkel
    California recently enacted a multi-faceted set of laws aimed at increasing compliance with existing building standards that are designed to ensure that individuals with disabilities have full and equal access to public accommodations. The legislation creates incentives for property owners and tenants to obtain inspection certifications by providing expedited court procedures for early, less costly resolution of construction-related accessibility claims.
    December 2008
    Perspectives on Real Estate
    Authors: James M. Rishwain, Jr., Deborah B. Baum, Scott E. Barat, James P. Bobotek, Wendelin A. White, William C. F. Kurz, Angela M. Yates, Roger C. Roy Jr., Christopher B. Leopold, Jr., Warren U. Lehrenbaum, David Tabibian
    The 15th edition of Pillsbury's Perspectives on Real Estate Newsletter features several articles written by members of Pillsbury's Real Estate section. Topics include Participating Mortgages, Real Estate Workouts, Real Estate Outsourcing, Eminent Domain, Greenwashing, CDARS- the Certificate of Deposit Account Registry Service, California Foreclosure Reform Law and Using Construction Engineers.
    9/18/2008
    New Requirements Under Senate Bill 1137, California's Foreclosure Reform Law
    Author: Angela M. Yates
    In July, the California State Legislature enacted SB 1137 as an urgency measure designed to address the adverse effects of the state’s high foreclosure rate. Broadly summarized, the new law 1) requires lenders to contact homeowner borrowers to explore options for avoiding foreclosure on their primary residence at least 30 days before filing a notice of default; 2) deems that loan servicers are acting in the best interest of all parties in agreeing to, or implementing, a loan modification workout plan if certain conditions are met; 3) gives residential tenants in possession of a rental housing unit at the time the property is sold in foreclosure 60 days notice to vacate the property; and 4) requires owners acquiring vacant residenti
    Spring 2008
    Perspectives on Real Estate
    Authors: Michael S. Hindus, Scott E. Barat, James P. Bobotek, Joseph W. K. Chan, Kate Myers
    The 14th edition of Pillsbury's Perspectives on Real Estate Newsletter features several articles written by members of Pillsbury's Real Estate Section. Topics include Rooftop Leasing, Green Hospitality, China's Real Estate Industry, Certificates of Insurance and Wages of Subsidy.
    4/9/2008
    DC City Council May Double Tax Rate on Vacant Property
    Owners of unimproved or unoccupied land in the District of Columbia may soon face a significantly higher tax bill. The passage of B17-86, the “Nuisance Properties Abatement Reform and Real Property Classification Amendment Act of 2008,” currently pending before the DC City Council, would change the way real property is classified for taxation purposes, and increases the tax rate on vacant property.
    3/25/2008
    Virginia Enacts Refund Law for Congestion Relief Fees and Other Transportation Taxes
    Authors: R.J. Davis, Lee Lowder
    From January 1, 2008, through March 3, 2008, property owners in Virginia were paying an additional tax on the sale of their real property (the “Congestion Relief Fee”). All of the Congestion Relief Fees will now be refunded to the taxpayers (i.e., property owners/sellers) under a new plan approved by the General Assembly and signed into law by the governor on March 25.
    3/11/2008
    Virginia Supreme Court Overturns New Grantor's Tax, But Relief May Only Be Temporary
    Authors: R.J. Davis, Lee Lowder
    On February 29, the Supreme Court of Virginia ruled that legislation authorizing the Northern Virginia Transportation Authority (NVTA) to impose the “Congestion Relief Fee” and other taxes and fees (“Transportation Taxes”) violated the Commonwealth’s Constitution. This decision, however, does not mean that the Transportation Taxes are permanently dead. Political leaders have stated their desire to quickly restore the taxes in a manner that satisfies the court’s constitutional requirements. Because of this, we encourage clients to anticipate the revival of the Congestion Relief Fee or similar tax in future real estate transactions.
    Fall 2007
    Pillsbury on Real Estate
    Authors: Alex D. Tomaszczuk, Scott E. Barat, Daniel S. Herzfeld, James P. Bobotek, Brant K. Maller, Jason A. Schwartz, Florence W. Prioleau, Rick B. Antonoff, Christian D. Dubois, Robert B. Haemer
    The 13th edition of this newsletter features several articles written on several topics related to the Real Estate industry. Topics include Solar Power, Wind Farms, Construction, Leasing, Series LLCs, "Carried Interest" Tax Legislation, and the state of the Subprime Market.
    Spring 2007
    Pillsbury on Real Estate
    Authors: Robert N. Weinstock, James M. Grosser, Marjorie Fisher Gannett, Christian A. Salaman, Phil T. Feola, Michael G. Silver, Stefanie N. George, Diane Shapiro Richer
    The 12th edition of this newsletter features several articles written by members of Pillsbury's Real Estate Section. Topics include Bulk Sales, Green Real Estate, Leasing, Condo-Hotels and Transfer Taxes.
    Winter 2007
    Pillsbury on Real Estate
    Authors: Laura E. Hannusch, Robert C. Herr, Rachel B. Horsch, Yemi Oladeinde; Kurt L.P. Lawson; Kate Myers; Phil T. Feola; Susan E. Michelich
    6/30/2006
    The Long-Awaited Rapanos Decision Narrows Clean Water Act Jurisdiction Over Wetlands and Tributaries, But Leaves Important Questions Unresolved
    Authors: Wayne M. Whitlock, Norman F. Carlin
    On June 19, 2006, a sharply divided U.S. Supreme Court issued its highly anticipated decision regarding the scope of jurisdiction under federal Clean Water Act Section 404 governing filling of wetlands and other discharges of dredged or fill material into “waters of the United States.” The Court overruled the Sixth Circuit Court of Appeals and rejected assertion of jurisdiction by the U.S. Army Corps of Engineers (“Corps”) over wetlands located on lands owned by Michigan developers John Rapanos and June and Keith Carabell.
    Spring 2006
    Pillsbury on Real Estate
    Authors: Wendelin A. White, Scott E. Barat, Jennifer A. Giblin, Peter G. Freeman, James P. Bobotek, Paul R. Schrecongost, Meredith Weinberg, Meredith R. Weinberg, Byron A. Rodríguez, Gary Downs
    6/24/2005
    Kelo v. New London—Profound Implications For Eminent Domain and Urban Redevelopment
    Authors: Deborah B. Baum, Lewis G. Feldman, Douglas A. Praw, Michael G. Silver
    On June 23, 2005, the U.S. Supreme Court decided the case of Kelo v. New London. The specific question in Kelo was whether a local government's condemnation of non-blighted private property for purely economic development purposes is constitutional. That question hinged on whether economic development qualifies as a "public use" within the meaning of the United States Constitution's Fifth Amendment Takings Clause. The backdrop for Kelo is the distressed municipality of New London, Connecticut, which had experienced a period of significant economic downturn. In order to assemble contiguous acreage for a large scale mixed-use redevelopment project, a development corporation sponsored by the city initiated condemnation proceedings against certain owners who had refused the development corporation's purchase offers for their properties. These property owners challenged the taking by stating that it was an impermissible use of the city's powers. Affirming a decision of the Connecticut Supreme Court, the U.S. Supreme Court held that, under the right circumstances, economic development can be sustained as a "public use" under the Fifth Amendment. The Kelo decision has broad implications for municipalities, real estate developers, and individual property owners alike.
    11/10/2004
    Landlord Alert: Limitations on Strategic Bankruptcy Filings by “Healthy” Companies to Cap Long-Term Lease Obligations
    Authors: M. David Minnick, Craig A. Barbarosh, Karen B. Dine, Mark Houle

    Summary

    Under Section 502(b)(6) of the Bankruptcy Code, Chapter 11 debtors have a very powerful statutory tool to limit a landlord’s recovery under a long term real property lease when the lease is rejected in bankruptcy. Generally, under Bankruptcy Code Section 502(b)(6), a landlord’s claim for damages resulting from the termination of a real property lease will be limited to the obligations due under the lease for the greater of (i) one year or (ii) fifteen percent, not to exceed three years, of the remaining term of the lease, plus amounts due under the lease on the earlier of the bankruptcy filing date or the date the property was surrendered. However, two recent judicial decisions, one by the Third Circuit Court of Appeals and the other by a California bankruptcy court, clarify that a lessee may be denied the ability to remain a Chapter 11 debtor when it is solvent and files for bankruptcy relief as a strategic maneuver solely to reject a lease and limit a landlord’s lease recovery. Knowledge of this evolving caselaw may impact your ability to protect your rights in certain situations.
    Spring 2004
    Pillsbury on Real Estate
    Authors: Robert C. Herr, James M. Rishwain, Jr., Christine A. Scheuneman, D. van Hoften, C. Harcourt, P. Henigan, B. Langman, D. Praw
    Fall 2003
    Pillsbury on Real Estate
    Authors: Norman F. Carlin, James M. Rishwain, Jr., Ronald E. Van Buskirk, Wendy Theophilos Coleman; Matthew E. Cudrin; L. Elizabeth Strahlstrom; Max Friedman
    Spring 2003
    Pillsbury on Real Estate
    Authors: Laura E. Hannusch, Lewis G. Feldman, Max Friedman
    Several articles written by members of the Pillsbury Winthrop Real Estate Practice Section are featured in this newsletter, including discussions of sublandlord's bankruptcy, terrorism insurance, and affordable housing.
    Summer 2011
    Understanding the Mindset of the Institutional Real Estate Equity Investor
    Source: Real Estate Finance Journal
    Authors: Brant K. Maller
    Brant K. Maller, the head of Pilllsbury's Real Estate Private Equity and Alternative Investment Teams, authored this article discussing the mindset of the institutional investor, with a focus on public pension plans. The article initially appeared in the summer issue of the Real Estate Finance Journal.
    Spring 2011
    If Your Bank Dies Is Your Deal Dead?
    Source: The American College of Real Estate Lawyers Papers
    Authors: Les Nicholson, Alex M. Phipps III
    Senior Counsel Les Nicholson, former General Counsel of the U.S. Government Service Administration and former Executive Vice President and General Counsel of Chevy Chase Bank, and Real Estate Associate Alex Phipps, discuss the questions facing borrowers in the wake of the recent economic recession and its effects on banking industry. The lawyers outline what happens to a bank once it fails and provide advice on action to take, should your bank fail. This article originally appeared in the Spring 2011 issue of the American College of Real Estate Lawyers Papers.
    Fall 2009
    Additional Risks Landlords Should Consider When Taking Letters of Credit From Commercial Lease Tenants
    Source: The Real Estate Finance Journal
    Authors: M. David Minnick, Ana N. Damonte
    This article by Insolvency & Restructuring partner David Minnick and Litigation senior associate Ana Damonte originally appeared in the Real Estate Law Journal, published by West.
    1/14/2008
    Spillover Effect from Subprime Collapse
    Source: Real Estate Board of New York: A New York Law Journal Special Section
    Authors: Brant K. Maller, Rick B. Antonoff
    7/9/2004
    New Code on Old Cabling: Something to Untangle
    Source: Washington Business Journal
    Authors: Elizabeth W. Rugaber, Debbie B. Spartin
    5/9/2003
    Developers Can Help Head Off Lender-Contractor Disputes
    Source: Washington Business Journal
    Author: Scott E. Barat
    5/8/2003
    Investments in REITs in Turbulent Markets
    Source: National Association of Industrial and Office Properties, Northern Virginia Chapter, Bus Tour 2003
    Authors: Jeffrey B. Grill, Sheldon Weisel

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