Last week was a tumultuous and trying time for everyone, in every industry, as the emergence and spread of COVID-19 in the United States and the resulting response effort thrust every industry into uncharted territory. Despite the rapidly evolving situation, federal, state, and local governments, as well as industry leaders, have issued and are continually updating procedures, guidance, resources, and other assistance to address the impacts of COVID-19.

In an effort to help you sort through the vast amount of news and information, below is a summary of developments, resources, actions and concerns that are most relevant to the real estate industry in Connecticut. In addition, Carmody’s COVID-19 Resource Center provides quick access to all of our alerts and updates and links to a wide range of information and resources accessible online.

We are continuously monitoring these developments and are available to help guide you through this difficult period of uncertainty.

Real Estate Related Governor Orders

Governor Lamont has issued a series of executive orders with cumulative and increasingly expansive effects. A complete list of the Governor’s executive orders can be found at the following link:, which is continuously updated as further orders are issued. Below is a brief summary of the executive orders most impactful to real estate owners and developers.

The most significant executive order issued by the Governor is Executive Order No. 7H issued on March 20, 2020, which directs all businesses to utilize, to the maximum extent possible, telecommuting or work from home platforms and requires all non-essential businesses to reduce their in-person workforce at each business location by 100% by March 23, 2020 at 8:00pm. A more detailed list of “essential businesses” was issued on March 22, 2020 by the Dept. Of Economic and Community Development and is accessible here.

Pursuant to Executive Order No. 7G, issued on March 19, 2020, Governor Lamont has indefinitely suspended all non-critical court operations and associated requirements. This includes the time limit for judgments in civil actions (§ 51-183b); civil process, service and time for return (Chapter 896); various statutes of limitation, including actions to enforce private restrictions, claims relative to title certificates, opinions and searches, claims of adverse possession, land surveys, etc. (Chapter 926); time constraints for filing administrative appeals under the Uniform Administrative Procedure Act (UAPA) (§ 4-183); venue and civil process requirements including those involving housing matters, actions involving land, and actions for partition or sale (§ 51-345).

Executive Order No.7I, issued on March 21, 2020 modified or suspended a wide range of procedural requirements related to municipal processes, including timeframes, filing processes, and notification requirements, including municipal wetlands, zoning and other land use processes.

Finally, Executive Order No. 7J eliminated numerous procurement, oversight, and approval processes related to the leasing, repair, alteration and use of real property by the state in order to address the COVID-19 emergency. These actions are intended to expedite the State’s ability to enter into leases of real property, and to construct improvements on property, in order to provide necessary facilities and services related to the COVID-19 crisis.

Other Real Estate Related Governmental Orders

Public Utilities Regulatory Authority (PURA)

On March 13, 2020 PURA imposed a moratorium on all residential utility shut-offs for the duration of the Governor’s COVID-19 emergency declaration. On March 18, 2020, the shut-off moratorium was expanded to all non-residential utility customers and PURA granted a temporary waiver of financial security deposit and balance reduction payments for reconnection of service, both of which remain in effect until May 1, 2020.

U.S. Department of Housing and Urban Development (HUD)

HUD issued a Press Release HUD No. 20-042 on March 18, 2020, in which HUD placed a moratorium on all foreclosures and evictions for FHA-insured single-family properties. Specifically, the order applies to homeowners with FHA-insured Title II Single Family and Home Equity Conversion mortgages and tenants occupying FHA-insured single-family properties. The moratorium took effect immediately and will persist for 60 days.

Governmental Relief and Support for Businesses

The State of Connecticut provides a resource page for businesses impacted by COVID-19 providing information on financial, business interruption insurance, tax, supply chain, and other topics here. Below are details concerning specific relief and assistance actions and programs offered by various governmental agencies. Property owners should consider providing this information to business tenants in order to help them mitigate and recover from the business disruption caused by COVID-19.

U.S. Small Business Administration (SBA)

Connecticut was one of the first states declared a disaster area allowing SBA to offer Economic Injury Disaster Loans for working capital needs (e.g. debt payments, rent, payroll and other operating costs) for up to $2,000,000 with a 30 year term and interest at 3.75%. Collateral is required for loans over $25,000, but SBA will accept subordinate priority and blanket security interests. There are no fees to apply, and applicants can decide to decline the loan at any time prior to funding. Loan processing is expected to take 18-21 days, so SBA’s guidance is to apply as soon as possible in order to get into the queue even if applicants are unsure whether they will take the loan. Non-profit organizations are also eligible to apply for these loans. Even if a requirement appears to be disqualifying, SBA’s recommends proceeding with the application and allowing SBA to make the eligibility determination. SBA recommends that applicants include: (a) detailed information about projected losses due to COVID-19; (b) a narrative explaining how the crisis is affecting the applicant’s business, and (c) information showing that the business will be able to repay the loan once the crisis has passed. Applications are submitted online here.

Connecticut Department of Economic and Community Development (DECD)

DECD has established a Business Emergency Response Unit dedicated to assisting businesses navigate resources and develop new resources in connection with COVID-19 issues. Business owners and managers can call 860-500-2333 to obtain assistance from the Unit. The DECD hotline will also provide further assistance and guidance on obtaining an SBA Economic Injury Disaster Loan.

Connecticut Department of Labor (DOL)

DOL has also issued guidance and assistance for employers and employees regarding unemployment and COVID-19’s impact to the labor markets. DOL’s guidance can be found here. The Carmody@Work team has published a number of information updates and articles providing guidance on COVID-19 issues, which are accessible in the Carmody COVID-19 Resource Center.

Internal Revenue Services

United States Treasury Secretary Steven Mnuchin has announced that the income tax filing and payment deadlines for individuals and businesses has been extended from April 15, 2020 to July 15, 2020. Taxpayers and businesses will be permitted to file and make payments to the IRS by this extended deadline without interest or penalties. The processing of refunds by the IRS has not been delayed, so those due or otherwise anticipating refunds are encouraged to file now in order for refunds to be processed promptly.

Connecticut Department of Revenue Services (DRS)

DRS has extended the filing and payment deadlines for most business returns due between March 15 and June 1 of this year to June 15, 2020 (with the exception of the pass-through return filing, which is presently due April 15, 2020). The deadline for personal income tax filings and payments, as well as estimated tax payments for the first and second quarters of 2020, has been extended to July 15, 2020. Like the IRS, DRS has assured timely processing of tax refunds.

Financing and Lender Relief

As social distancing, closure orders and other COVID-19 measures impact business revenues, concerns have arisen about the ability of businesses to make debt payments and rent payments, which will in turn, affect the ability of property owners to meet their debt obligations.

On March 17, 2020, the Connecticut Banking Commissioner issued guidance to Connecticut State-Chartered Banks and Credit Unions requesting that lenders work with borrowers to ease banking practices such as easing credit terms for new loans, waiving overdraft fees, waiving late fees for loan balances, increasing the number of allowed money market withdrawals, waiving CD early withdrawal penalties, and offering payment accommodations such as allowing borrower to defer payments or extending payment due dates. Banks and other financial instructions are considered “essential” businesses under Executive Order No. 7H, and therefore not subject to the Order’s restrictions.

Several large banks and financial institutions are offering various forms of relief for borrowers including Ally Bank, Bank of America, Capital One, Chase, Citi Group, Goldman Sachs, U.S. Bank, Wells Fargo. is maintaining a current list summarizing each institution’s various relief policies, which can be found here.

Real Estate Transaction Closings

Each Town Clerk has adopted varying policies for their respective operations posing challenges for closing real estate transactions that are dependent on access to land records. Some have closed their offices indefinitely, other for specific time periods, and others are operating in limited capacity or by appointment only. Many Connecticut towns have land records accessible online, including the City of Norwalk, which launched its online land records system earlier than scheduled in response to COVID-19, but these systems are often several days behind in digitizing records. Fortunately, the title insurance companies have each established policies and procedures in order to continue the execution of real estate transactions despite the closures of Town recording offices and limited access to land records. Presently, all of the major title insurance companies in Connecticut are providing title insurance coverage as of the time of closing even though recording may be delayed for an extended period of time. This is allowing closings that are in process and near closing to be completed. However, the limited access to land records may prevent or limit title searches for new transactions.

Impacts on Purchase Agreements, Leases, and Other Contracts

COVID-19 Contract provisions

As new real estate transactions are considered or negotiated during these unprecedented times, whether in the commercial or residential context, the parties should consider the potential impacts the COVID-19 response measures will have on a party’s ability to perform under a purchase and sale agreement. COVID-19 response measures are likely to have adverse effects on a party’s diligence investigations, and ability to obtain financing or close a transaction. These considerations should be weighed and appropriate provisions included in the purchase and sale agreement to provide extension and/or termination rights in the event a party’s ability to perform is impacted by elements outside of its control (e.g. delays caused by a declared state of emergency or public health emergency, pandemic (specifically including COVID-19), government-mandated quarantine and/or order of government or civil or military authorities.

Force Majeure

Many existing contracts, leases, mortgages and other agreements contain so-called “force majeure” provisions that excuse a party from performing its obligations during extraordinary events. The terms of these provisions vary and should be reviewed to determine whether the COVID-19 pandemic constitutes a “force majeure” that applies to either your obligations to others or their obligations to you. In additions, such provisions often have specific notice or other conditions required to invoke a “force majeure” allowance.

Environmental Compliance

The Connecticut Department of Energy and Environmental Protection (DEEP) is continuing to operate as usual, with many staff members working remotely. In-person meetings will likely be difficult in the coming weeks, but DEEP is capable of and amenable to virtual web-based meetings and conference calls. DEEP is encouraging electronic submission of documents, to avoid overwhelming the mail room. Processing times for pending matters are likely to be delayed. The current COVID-19 situation may result in delays in active site investigations and remediations, due to social distancing directives and related site access issues. DEEP has not addressed this specifically at this time, so parties responsible for such activities should consider whether any such delays may result in non-compliance with investigation and remediation schedules or contractual obligations, and request extensions as appropriate.

Carmody is Here to Help

Additional information and resources are available at the Carmody COVID-19 Resource Center. For guidance and advice on these issues and your particular situations and concerns, please contact one of our real estate attorneys. We will all get through this together. Be safe and stay healthy.