NAIOP commends the U.S. House for today’s passage of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), following the U.S. Senate’s passage on Thursday. We expect President Donald Trump to sign it into law shortly.
The CARES Act will provide critical relief as businesses and individuals strive to manage the economic challenges created by the COVID-19 pandemic. We look forward to continuing our work with elected leaders on next steps, as well as supporting our members and the industry as we weather this crisis and plan for the future.
Items in the legislation important to NAIOP members and commercial real estate include:
• An aggressive loan program for small businesses, many of which are commercial real estate tenants, that is designed to help them meet their financial obligations and keep their employees on payrolls over the next few months. The loans, which are forgivable, will provide many of our tenants with needed liquidity to keep them operating during the crisis.
• A much needed technical correction in the tax code for leasehold improvements, or Qualified Improvement Property (QIP). The Tax cuts and Jobs Act (TCJA) mistakenly made QIP depreciable over 39 years instead of 15, and ineligible for bonus (100% depreciation). The CARES Act fixes that, ensuring that those who made these investments in 2018 and 2019 can file amended returns and recover any overpaid taxes.
• Net Operating Loss (NOL) rule changes allow businesses to carry back for 5 years any losses from 2018, 2019 and 2020, and losses carried forward can offset 100% of taxable income.
Additional provisions in the CARES Act and other federal actions already taken will be much-needed help for our economy.
NAIOP’s strong advocacy on Capitol Hill was influential in protecting commercial real estate and ensuring our industry was included in this important legislation, particularly the QIP fix that has been a NAIOP priority issue for two years.
Throughout the COVID-19 crisis, NAIOP has provided you education, delivered knowledge, and protected our members with valuable advocacy efforts. We are steadfast in our commitment to supporting our members and the industry, both in challenging times and in prosperous ones. Next week, we’ll add to our resource offerings with three additional webinars and the launch of our virtual roundtable program. I look forward to sharing more with you in the days ahead.
Thomas J. Bisacquino
President and CEO | NAIOP