Coronavirus/COVID-19: Considerations for Landlords and Property Managers

COVID-2019 is a new strain of coronavirus that emerged in central China at the end of 2019 and continues to spread around the globe. The COVID-2019 outbreak has been declared a pandemic by the World Health Organization (WHO) and is already having a major effect on international commerce. As the outbreak expands in the United States, commercial real estate owners and property managers should be well prepared to monitor and address concerns impacting the industry as a result of the virus.

Considerations for Commercial Landlords and Property Managers

The typical commercial lease and property management agreement does not address viral epidemics. The duties and obligations of a landlord or property manager regarding limiting tenants' and guests' risk of exposure to the virus depends on what services, if any, the landlord or property manager provides at the property. In a net leased property where the tenant is responsible for its own maintenance and cleaning services, the landlord's public health obligations would be limited. However, a landlord or property manager who provides cleaning, janitorial and security services such as in a commercial office building or shopping center, should consider implementing the following operational recommendations:

• consult your local health department and the U.S. Centers for Disease Control and Prevention (CDC) for the latest information on the virus and guidelines for controlling transmission
• clean routinely and frequently touched surfaces and objects, including but not limited to, bathrooms, security desk areas, elevator banks, turnstiles, escalators, door handles, communal kitchens or pantries, bathrooms and the like
• offer materials, in multiple languages, to educate employees, visitors, vendors, delivery personnel and staff about proper hand hygiene and cough etiquette
• install hand sanitizer stations in high-traffic areas of the building
• advise any employees who may feel sick to limit face-to-face contact with others and to seek immediate medical help
• consider alternatives and safety protocols for large, public events held on the building property
• review your internal communications and preparedness plan and ensure that all building staff are ready, know their role in keeping the property and its guests safe, and are aware of all communication protocols
• follow Occupational Safety and Health Act (OSHA) requirements, set forth in Sections 13 and 14 of OSHA No. 1 of 2006, which impose various duties on the employer to ensure a safe and healthy work environment
• discuss human resource considerations such as screening employees that have traveled to areas where the virus has been reported and implementing protocols for dealing with a situation where an employee may be infected with the virus
• review leave policies and confirm compliance with legal requirements around mandatory quarantines
• consider ongoing communications with tenants and service providers to inform them of the steps you are taking to clean and sanitize the property and learn how they are addressing the outbreak with their employees and customers
• conduct risk assessment analysis and anticipate supply chain interruption
• review any rights or remedies the property may have under policies of insurance, which may include coverage for business interruption
• consult with counsel about the COVID-19's impact on the property, contractual obligations and business operations

Holland & Knight attorneys in the following areas are well versed in addressing issues related to COVID-19:

If you have any questions regarding the COVID-19 outbreak and its effects on the commercial real estate industry, please contact a member of Holland & Knight's Real Estate Practice, including Partners Kelly Bagnall or Christopher Camarra.

To learn more about how COVID-19 is affecting the hospitality sector, see Holland & Knight's alert: "Coronavirus/COVID-19: Considerations for the Hospitality Industry."

DISCLAIMER: Please note that the situation surrounding COVID-19 is evolving and that the subject matter discussed in these publications may change on a daily basis. Please contact the author or your responsible Holland & Knight lawyer for timely advice.

Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem. Moreover, the laws of each jurisdiction are different and are constantly changing. If you have specific questions regarding a particular fact situation, we urge you to consult competent legal counsel.