Real Estate Leasing

On Friday, April 3, 2020, Maryland Governor Larry Hogan issued Executive Order 20-04-03-01, which amended and restated his March 16, 2020, Executive Order in its entirety.  In the March 16 Executive Order, Governor Hogan placed temporary prohibitions on evictions for residential real property. The April 3 Executive Order extended that temporary prohibition to commercial and industrial real property.

Therefore, until the current state of emergency is terminated and the catastrophic health emergency is rescinded, no Maryland court may grant judgment for possession or repossession, or warrant for restitution of possession or repossession of commercial or industrial real property under either Maryland Real Property Art. 8-401 (Nonpayment of Rent) or Maryland Real Property Art. 8-402.1 (Breach of Lease), if the tenant can demonstrate to the court, through documentation or other objectively verifiable means, that the tenant suffered a Substantial Loss of Income (as defined in the April 3 Executive Order).

For purposes of the April 3 Executive Order,

“Substantial Loss of Income” means (i) with respect to an individual, a substantial loss of income resulting from COVID-19 or the related proclamation of a state of emergency and catastrophic health emergency, including, without limitation, due to job loss, reduction in compensated hours of work, closure of place of employment, or the need to miss work to care for a home-bound school-age child; and (ii) with respect to an entity, a substantial loss of income resulting from COVID-19 or the related proclamation of a state of emergency and catastrophic health emergency, including, without limitation, due to lost or reduced business, required closure, or temporary or permanent loss of employees.

The April 3 Executive Order, while temporarily prohibiting evictions for commercial or industrial real property, does specifically state that nothing in the Order shall be construed as relieving any person or entity of any obligation to make payments or to comply with any other obligation that such person or entity may have pursuant to its lease.

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