FIG's Response to the Coronavirus (Covid-19)Mar 13, 2020
Please see below for FIG's official update on the Coronavirus situation, sent to our clients a few moments ago...
FIG Coronavirus (Covid-19) Response
Dear FIG Investors,
This likely isn’t the first message you’ve received about the current Coronavirus and how companies are adapting. It’s certainly been an interesting few weeks!
With more uncertainty ahead, we felt it important to notify you about our current outlook on FIG operations. All of the FIG companies are committed to moving forward in developing, building, and managing the units you have entrusted us with. While nobody knows for sure how long this will go on, most agree that it will eventually settle down.
But in the meantime, closings need to happen, buildings need to be built, and units need to get leased. At FIG we still firmly believe that new and affordable rental housing will be in demand and profitable for investors to own.
Here’s a quick summary of what we’re seeing in the key segments of our business:
Closing and Funding of New Buildings
Currently, FIG investors and lenders are funding and starting construction on units in Cypress, TX, and Meridian, ID. More closings are on the way in Payson, UT in the coming months...and even more locations beyond that this summer.
We have visited with several of the construction lenders that we rely on to fund these projects. So far, they have indicated that their business needs to continue and that they plan on funding loans as usual. Like many businesses, some bank employees may work virtually for a time, but their intent is to adapt and keep things moving.
Title companies are also open for business, as we’ve been coordinating with them in both Texas and Idaho this week. Technology is allowing for banks and title companies to operate far more efficiently on a remote basis than they could 10-20 years ago! If this begins to change, we will notify you as soon as possible.
If you have a unit under construction right now, know that your contract is still in place and that Volkommen Construction still projects to finish within the agreed-upon 12-month timeline. So far, sub-contractors are showing up and completing their tasks and have given no indication of letting up.
A few weeks ago we saw some delays in the delivery of flooring and door hardware from China. The supply situation out of China appears to be normalizing and we are not hearing of any substantial delays in building materials making it to the US. Once materials arrive in the US, transportation of those materials is operating as usual.
Some cities have started sending their non-essential employees home to work virtually. One area of concern is that of building inspections. If cities begin restricting inspectors from working, this could cause delays in construction completion. To date, all cities have indicated they plan on continuing to allow inspections to happen as these don’t take place in large gatherings and don’t appear to be a risk.
In summary, subcontractor labor, materials, and building inspections are expected to continue to operate with minimal, if any interruption. If we see changes here we will let you know!
Property Management and Leasing
MAXX Property Management will continue to conduct operations in the safest way possible for their team and customers. The leasing staff are limiting physical contact with current and prospective tenants, but still conducting showings of units. To date, Maxx has not seen a slow down in lease traffic that is attributable to the Coronavirus.
Showings and lease signings in Utah, Texas, and Idaho are continuing as normal and are experiencing the usual pickup we see with the gradual arrival of Spring. If we begin to see a dramatic slow down in leasing due to social distancing, we’ll notify you so you can plan accordingly.
In addition, if local or national governments place restrictions on person-to-person contact or prohibit any activity necessary to lease properties, we will adapt to whatever extent possible. We are aware of the fixed costs associated with real estate ownership and will continue to work hard to lease and manage your properties.
Thank you for your business!
If you have any specific questions on this matter, please don’t hesitate to reach out. In the meantime, know that FIG and its partners are dedicated to helping your investment navigate these uncertain times!
The Fourplex Investment Group
Mike Miller, Owner
Steve Olson, Director of Sales
Corey Bohner, Director of Maxx Property Management