Our company was fortunate to receive enough Paycheck Protection Program (PPP) money to allow us to offset a substantial amount of uncollectable rent and other income at our fee-managed properties.
PPP is allowing us to follow through on our case-by-case approach to challenged residents. For those who are demonstrating responsibility, doing what they can, and working to improve their situation, we are forgiving some or all of what they owe in exchange for committing to a fresh start, extending leases in some cases and significant goodwill. We are helping them with other resources and counseling as well. So far, this is working beautifully for hundreds of people. Residents who were avoiding us, are suddenly racing to pay rent. Many a tear has been shed.
The few who insist on being irresponsible (about 1%) understand they will be evicted at first opportunity without forgiveness - like the guy who blew his stimulus money on new rims instead of catching up on rent.
Currently, we expect May collections to be off no more than 10% (as opposed to the 30% we were originally prepared for). Once we see how the month shakes out, we plan to go through another round of evaluations and forgiveness for those who need and deserve it. We expect our PPP money will sufficiently offset these losses, and those anticipated over the next few months, so that our staff, owners and ourselves can stay whole through the crisis. In the end, we expect our properties to be full of very loyal and responsible, long-term residents.
While not entirely foreseen by the PPP designers, we believe we are putting the taxpayer's money to the best possible use. Everyone is winning.
