“There were sudden moments when objects, concepts and even people that the chaplain had lived with all his life inexplicably took on an unfamiliar an irregular aspect that he had never seen before and which made them seem totally strange: jamais vu . . .

The episode of the naked man in the tree at Snowden’s funeral mystified the chaplain thoroughly. It was not deja vu, for at the time he had no sensation of ever having seen a naked man in a tree at Snowden’s funeral before. And it was not jamais vu, since the naked man in the tree at Snowden’s funeral was not someone familiar to him appearing in an unfamiliar guise.”

Catch-22

The usual has become unusual. The familiar, unfamiliar. We’re not experiencing mass deja vu (“before seen”) but rather a worldwide case of it’s often-unremarked opposite jamais vu (“never seen”). We are seeing things as we’ve never seen them before and it’s a little unsettling.

But it isn’t really new. I tried to count all of the pandemics recorded in human history and when I got to one hundred I gave up. The point being that while this is jamais vu for us, it isn’t for humanity. As a planet we’ve been here before.

And so as much of the country finishes its third week of quarantine the near-future becomes a bit clearer. We are now in the Deep Freeze as most of us are told to stay home. The Thaw will come next, the period of time where we slowly restart everything, enduring intermittent regional quarantines as outbreaks re-emerge. This will last months, depending on the veracity, speed and availability of testing. Then one day we’ll look back and realize that we have passed through this, that the unusual is no longer usual and that we are well on our way into The New Normal.

Here in retail world the Deep Freeze means that April rent has largely been “deferred.” I suspect that May and June’s rent will be too. No, nobody knows what “deferred” means, except that ultimately it means retail landlords will be forced to become financial M.A.S.H. units, triaging the tenants who will certainly survive from those who will certainly fail and choosing which ones in the middle to assist with time and money. This is the inverse of merchandising: not which tenants do you want but which ones are you willing (able) to let go? 

For many, this stack ranking exercise is uncharted territory, especially for landlords whose principal rent source isn’t retail. Office and industrial tenants are effectively equal, but in retail world some are more equal than others. The barely-good “credit” restaurant won’t pay rent and your beloved local restaurant can’t. You have a dying JC Penney you wanted to get rid of, but what happens if the government throw gobs of money at it to keep it alive another year? You need to cut operating costs, but can you afford to cut marketing (assuming you can show it brings back patrons and drives sales)? How do you pay brokers when much of 2021 retail rent is probably free? And how do you manage the future when you’re spending all of your time modifying every single retail lease in your portfolio?

For landlords out there who secretly want to be restaurateurs: good news! You’re in luck. We are going to see landlord-owned restaurants in the near future. These will be run on hospitality incentive contracts with profits (and losses) flowing to the building owner.

Success through The Thaw will depend a lot of things, from willing lenders to active management to specific market knowledge to understanding your tenants’ businesses; this is a great time to brush up on the basics of restaurant PNLs. We have come up with a relatively straightforward methodology we are using to help organize the triage (happy to send your way, just email us). So far I’ve seen a lot of information-sharing about best practices to get through The Thaw, which makes me exceptionally proud of our industry.

Now onto more interesting diversions for your weekend. . .

Some fantastic recommendations from friends:

• PODCAST: 99% Invisible (David Laube, Noell Consulting: “One of the best. How design impacts us in ways we don’t even realize”)

• MOVIE: Fargo (Libby Lassiter, Bayer: “I just watched it again with my daughter and we howled all through it. A bit of levity and a nice respite”)

• BOOKS: A good friend referred me to delanceyplace.com years ago, and I’ve discovered dozens of great books as a result. Highly recommended.

• PLAYLIST: Chess Records Essential Playlist (James Cook, JLL). Listening to it now as I write. Fantastic.

• TV: Catastrophe. (Kristie Abney, Full Plate: “Hilarious!”)

When my youngest was 7 she put a questionnaire with her tooth for the Tooth Fairy, which among others asked “What is your favorite desert?” “The Sahara” was the Tooth Fairy’s wise-ass answer.

But if you asked the Tooth Fairy and those now 12- and 14- year old daughters what their favorite dessert is, they’d answer Buttermilk Pie. This recipe came from the long-gone Raleigh House restaurant in Kerrville, Texas. It’s a close cousin to chess pie and the ingredients are almost always in your pantry through summer, winter or quarantine.

• Pie shell. You can be fancy and make one but pre-made is just fine

• 1 stick of butter, softened

• 2 cups suger

• 3 eggs

• 3 rounded tablespoons of flour

• 1 cup buttermilk

• Nutmeg

• 1 tsp vanilla

1. Mix softened butter and sugar. Mix eggs one at a time and then flour. Add buttermilk, a dash or two of nutmeg, and vanilla. Combine and pour into unbaked pie shell.

2. Bake at 350 for 45 minutes, or until the top is brown and the center has set. Sometimes you might need to cover the crust with foil. This freezes well and will keep in the fridge for a week. If it lasts that long.

We’d love to hear what you’re seeing, or what you think is in store over the next few months. We’ve been talking with clients and investors in every U.S. time zone, and while there is plenty of uncertainty I’d say it is lined with optimism. This is hurting, and it will for a while, but we’re going to get through this. We always have.

As always, thanks so much for reading. If you’ve been forwarded this email and would like to subscribe, please click here.

If you have any book or movie or podcast suggestions, please contribute! This formerly-monthly note has become weekly and so it might as well become a conversation also.

Be safe and well.

 G