Post by
lashing on May 05, 2020 12:52pm
Fund breaches covenants as does every operator
If this was just a market crash, I'd by being this one. I've been waiting since 2008. However, the COVID restrictions make this a no go zone for obvious reasons.
Operators pay all expenses. They will go broke like never before seen. Operators of single digit profit businesses cannot have a bad christmas let alone close for several months.
THe fund finally updated. The fund will be in breach of Debt covenants. Take out is not doing well. Not shock but how anyone here things a massive commercial property will weather this ... sorry but thats insane. Boston Pizzas are not Dominos. Their business revolves around asses in seats, willing beers with their meal, watching the game (also cancelled)
Boston Pizza is in very big trouble. Its a shame out governments would do this. No one can pay rent/taxes/utilies on a big empty restaurant. As for coming back online at 50% capacity, thats even worse. How do you staff that? How do you operates a signle digit profit margin business at half capacity. YOU DONT. Its better to close than bleed money at 50% with the threat of another shutdown looming.
There is nothing positive about the current situation. If this all goes away and everyone reopens fullly there will be no distributions for many months and operators and the fund itself play catch up with new debt.