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Tag Archive: COVID-19

  1. Inflation Uptick, What You Need to Know and Should Expect

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    The recent pandemic has caused significant construction supply chain challenges. Material costs have increased drastically; lumber futures are up 280%, steel mill product costs are up 55.6%, and gypsum product costs (plaster, drywall) have increased 12.5%. On top of the cost increase, lead times for construction materials have doubled or tripled, in many cases.

    One example to offer…a BDR client recently called a contractor for a 6,000 square foot build-to-suit retail structure. Upon giving the bid, the contractor stated, “We will hold this pricing for two days.”  This is in stark contrast to the typical pricing hold of 30 days. The urgency on both sides is a result of supply chain challenges.

    Tensions like these extend beyond material cost increases. The Federal government recently injected an estimated $6 trillion dollars into our economy. Many businesses, communities, and families depended on this money to sustain their livelihood during the government shutdown. While the government took this step to rescue our economy in the short-term, the long-term impact should not be overlooked.

    Inflation is a reality we will face in the years to come. Dating back to 1914, the yearly inflation rate in the United States has averaged 3.23%. The highest single month of inflation was in June 1920 when it skyrocketed to 23.70%. Since 2009, inflation has averaged 1.5-2% per year. According to, April 2021’s inflation (most recent data point) is 4.2%. Each month in 2021 has seen an upward inflation trend.

    There are several reasons inflation can uptick. Some of the causes include:

    • Injecting money into an economy. During the COVID-19 pandemic, the United States government injected around $6 trillion in the economy, which has ballooned our national debt to an astonishing $25 trillion. Since February 2020, the monetary supply in the United States has increased 26%. This is the largest one-year jump since 1946. According to USA Today Money, “Creating too much money that chases too few goods leads to price inflation, decreasing the purchase power of the dollar.” To note, there is more US currency in circulation today than ever before.
    • Demand-pull effect in an economy. Staying at home has led many folks to save up money (fuel cost, eating out for lunch) while consistently living hours in a single space (home). The reality many have lived for the past 12+ months provides an abundance of opportunity to find things to upgrade within a home. This COVID-sparked phenomenon has led to a surge in demand for goods and services. Look at the current residential housing market. Virtually any residential real estate agent will emphatically tell you it is currently a seller’s market. This extends well beyond our home base in Morgantown, WV, to the entire country.
    • Cost-push effect in an economy. In addition to increased demand, suppliers have been unable to maintain pace due to labor and raw material shortages. For an extended period of time, factories were shut down or stalled due to the pandemic. The effect is large gaps in the supply chain across many sectors – from chicken wings to construction materials. Increased and/or consistent demand with a decrease in supply results in higher prices.

    These signs and more point to high rates of inflation. The volume of currency (USD) circulating in our system, pent-up demand for product and current supply chain issues are key indicators of increased inflation, which means tomorrow’s dollar will be worth less than today’s dollar.

    One way to invest smartly given this circumstance is an inflation hedge. An inflation hedge typically involves investing in an asset expected to maintain or increase its value over a specified period of time. The investment goal is to secure assets close to, at, or greater than the rate of inflation. Investors should weigh their options across all investment opportunities.

    Real estate is considered a strong hedge against inflation because property values and rents typically increase during times of inflation. Real estate has intrinsic value, is in limited supply, and is a yielding asset. People need to have shelter regardless of the value of their currency. Real estate investing also allows investors to utilize other people’s money, include the banks’, to make money.

    Interest rates are still hovering around all-time lows which makes real estate a particularly attractive option in the current investment environment. When the rate of inflation goes up, fixed-interest rate financing costs less than when the loan was taken out since the dollar has lost some of its value. The borrower is essentially paying the lender back money that’s worth less than when the borrower took out the loan. This allows investors/borrowers to pay back loans using cheaper dollars.

    A dollar today is worth more than a dollar tomorrow.

    At Black Diamond Realty, we have seen an uptick in demand for multifamily assets and other investment properties, income producing assets, across all sectors. We anticipate this trend to continue due to many of the reasons highlighted in this article. West Virginia has received tremendous positive economic momentum. From the Hyperloop announcement to the Smith’s Ascend WV program, momentum is building in WV. North Central WV remains an economic shining star in the state.

    Call Black Diamond Realty today to explore your investment options. We have a team of professionals who understand complicated dynamics driving the various markets we serve. Let us underwrite your next investment project. Hedge against inflation wisely.


    Article by: Article by: David Lorenze, Caleb Wooldridge Edited by: Dr. Stephanie Lorenze

  2. Black Diamond Realty’s response to COVID-19, a note from our Principal

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    At Black Diamond Realty, our team has shifted to a work-from-home setup filled with screen sharing, remote server access and unique daily distractions, like children dodging in and out of video calls. We certainly are living in challenging and unprecedented times. Several weeks ago, the movie Contagion felt more like a sci-fi thriller, but has now become the reality for many Americans. We main strong as West Virginians and Pennsylvanians, and we know that we are in this together.

    For some, the devastation is far greater than others. Some businesses survive and thrive on people, check that – lots of people, traversing through their doors on a daily basis. Some industries, like hospitality, require people to travel from different states to spend time in a city outside of where they call home. How do these types of businesses survive? For some, resiliency will keep the lights on and doors open. For others, despite their strongest efforts and desires to stay open, the task at hand is insurmountable. The margins and cash reserves are simply not there for some businesses who operate on a week-to-week or month-to-month basis. However, for most, hope remains and modifications to our previous routines can turn that hope into a positive outcome.

    At Black Diamond Realty, we want to do our part to help support those struggling. We encourage our readers to do the same. Here are some tips of how you can support a local business.

    • Order take-out as much as you can afford it. Choose restaurants you love, especially locally-owned, ones you patronized prior to the introduction of COVID-19. Your support may help keep their doors open after this is all over.
    • Give to your local food bank, food pantries and non-profits battling hunger/food insecurity. Many of our neighbors are food insecure and do not know where their next meal will come from.
    • Pre-book parties and gatherings at your favorite establishments that are many months out. This could serve as a boost for business owners who greatly need it.
    • Buy gifts, wine and household needs from local establishments rather than big box retailers.
    • Share your positive stories on social media. Tell the world about your funny quarantine experiences. Share photos of things you and your family are doing.
    • Connect with one individual per week who you have not spoken to in a long time. Physical distancing does not mean social distancing. Today’s technology allows many to remain connected.
    • Write a letter to some of your favorite businesses in town letting them know you are thinking about them. The psychological boost will mean the world to many business owners.

    Additionally, the federal government has come to the aid with various programs aimed at maintaining jobs and aiding our economy during these challenging times. Last week, Black Diamond Realty posted some valuable information on our website and social media outlets identifying helpful federal loan and grant programs aimed at aiding business owners, independent contractors and individuals. Applications for business owners were accepted, beginning Friday, April 3. Independent contractors can submit their applications starting Friday, April 10. Please spend a few minutes reviewing your options.

    Click Here to review the CARES Act

    A reoccurring question has emerged over the past few weeks. How has the commercial real estate market been affected? Before answering, please keep in mind our experiences and observations are only a small sample size of real estate activity. With that in mind, Black Diamond Realty has experienced two sale deals that have been derailed due to buyer uncertainty associated with the economy. In addition, a handful of leases have been put on hold, hopefully temporary in nature, for the prospective tenant to “wait and see” how things shake out. On the positive side, numerous deals continue to press forward as many still believe in the long-term vitality of investing and establishing in this region. Several new deals have surfaced in the past three weeks since Corona made its unwelcomed introduction to America. Investors are looking for stability and economic opportunity. Interest rates are at a historic low while stock market volatility is extremely high after an 11 year bull run. For many, a shaky stock market mixed with low cost of funds results in a great time to diversify portfolios into commercial real estate.

    At Black Diamond, we work hard to initiate positive change in all the communities we serve. Please reach out if you have any questions, concerns or suggestions on how we can help our neighbors overcome this challenging situation.

    In an unprecedented way, COVID-19 and the corresponding challenge has the potential to make our nation and moral fabric stronger.  Let’s do our part to help turn a negative into a positive. Be kind. Be grateful. Share your love, time, talent and treasures with others in need. We will emerge stronger.


    Article by David Lorenze, BDR Principal

  3. CARES Act & Other Business Assistance Programs

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    As our nation navigates through the COVID-19 crisis, businesses are beginning to feel the effects first hand. As a means of financial relief, the government has passed the Coronavirus Aid, Relief, and economic Security (CARES) Act.

    The CARES Act will provide $377 billion to help prevent workers from losing their jobs and small businesses from closing their doors due to economic losses caused by the COVID-19 pandemic. Download the printable sheet HERE.

    Paycheck Protection Program:

    The bill provides 8 weeks of cash-flow assistance through 100 percent federally guaranteed loans to small employers who maintain their payroll during this emergency.

    • If the employer maintains its payroll, then the portion of the loan used to cover payroll costs, interest on mortgage on obligations, rent, and utilities would be forgiven.
    • The bill provides this support to small employers 500 employees or fewer, self-employed individuals and gig economy individuals, nonprofits and 501(c)(3) organizations and 50(c)(9) veteran organizations.
    • Loans will be available immediately through more than 800 SBA-certified lenders, including banks, credit unions, and other financial institutions.
    • The size of the loans may equal 250 percent of an employer’s average monthly payroll. The maximum loan amount is $10 million.​

    View Paycheck Protection Program (PPP) FAQ


    Small Business Debt Relief:

    The bill would require the SBA to pay all principal, interest, and fees on all existing SBA loan products, including 7(a), Community Advantage, 504, and Microloan programs, for six months to provide relief to small businesses negatively affected.

    Entrepreneurial Assistance:

    The bill provides $265 million for grants to SBA resource partners, including Small Business Development Centers and Women’s Business Centers offering assistance those small businesses impacted by the coronavirus.

    Emergency Economic Injury Disaster Loan (EIDL) Grants:

    The bill expands eligibility for companies suffering economic harm due to COVID-19. The bill allows businesses to apply for EIDL expedited access to capital through emergency grants – an advance of $10,000 within 3 days to maintain payroll, provide paid sick leave, and service other debt obligations. See below for detailed information and links to more information.

    View EIDL Program FAQ

    View EIDL Program Training Sessions

    To learn more about this grant CLICK HERE.


    Information provided by The Partnership. Visit The Partnership website for additional information. 


  4. Mon Health Seeks Equal Treatment When State Reviews Fairmont Hospital Projects

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    Mon Health System hopes that it will be treated on par with WVU Hosptials when the state Health Care Authority evaluates their somewhat parallel plans to open new hospitals in Fairmont. Both systems want to fill the gap left by the recent closure of Fairmont Regional Medical Center. In a statement released Tuesday, Mon Health President and CEO David Goldberg referenced a March 13 visit by Gov. Jim Justice to Fairmont to tout WVUH’s two projects.

    Politicization of healthcare is not safe and not smart, especially at a time with national, regional and local impacts from COVID-19,” Goldberg said. “What is happening across West Virginia is a perceived focused toward a single source of healthcare by one non-profit dominant healthcare system. National evidence shows that this leads to increased costs, diminished efficiency of convenient access, and ultimately a market monopoly. Most of all, the choice patients have and the right of citizens to choose where they want to get healthcare is taken away from them.” He continued, “Mon Health System has filed a worthy and appropriate Certificate of Need application to build a new hospital to serve Fairmont and the surrounding region and deserves fair and balanced review and consideration so that Mon Health System is not excluded from the Fairmont market.”

    On March 10, Mon Health notified the HCA that it will seek a certificate of need (CON) for a Mon Health Marion Neighborhood Hospital with an emergency room, 10 inpatient beds and the services of an acute care hospital. The estimated cost is $25 million and would take 18 months to complete.

    On March 20, WVU Hospitals notified the HCA of two projects it will seek CONs for: a 10-bed hospital in the FRMC building to serve as an interim facility and Ruby Memorial campus, at a cost of $8.79 million and taking one month to complete upon approval; and a subsequent 25-bed hospital at a separate site, to cost $35.3 million and be completed within 32 months. Justice characterized the WVU effort as a 100-bed hospital, but he conflated WVUH’s plans indicated in its letter to the HCA. WVUH said that after the initial project it anticipates two or three additional construction phases that “could approach approximately 100 beds.

    Goldberg said in his statement, “The governor has suggested that West Virginia’s Certificate of Need laws might be set aside so that WVU Medicine can move more quickly to replace hospital services. … There has been no indication from the governor that the possible set-aside of the Certificate of Need law will be applied in a fair and equal manner for any other independent entity, including Mon Health, to more quickly proceed with its project.

    The Dominion Post reported that on March 13, while the governor said he was thrilled and “tickled to death” about Mon Health’s plans for Fairmont, it wasn’t enough to amply serve the area. The Dominion Post asked Justice about this issue during his Tuesday COVID-19 press update, but his answer was unclear, as he focused instead on his idea of using FRMC as a backup hospital should virus cases overwhelm existing hospitals, and waiving any CON process to make that happen.

    Justice on Tuesday again talked about using if for overflow. “If you don’t dream big enough you’ll never get it done.” Without addressing Mon Health’s plan, he said he’s looked at way to speed up WVUH’s process, but the state rules and regulations regarding CONs are clear. Some rules have been relaxed for the COVID-19 pandemic, but others haven’t. “It doesn’t mean I’m not to going to go back and try to change the answer.

    Mon Health and WU Medicine both offered comments on Tuesday via email exchange. WVUM spokeswoman Heather Bonecutter said, “As I’m sure you understand, we’re focused entirely now on making sure WVU Medicine is fully prepared to respond to a surge in COVID-19 cases. We were surprised to hear the statements made yesterday. We are supportive of Mon Health’s project in Fairmont.” Goldberg said, “We have had multiple conversations with many parties to ensure healthcare choice and access is maintained in the Fairmont community for hospital-based services, outpatient care and durable medical equipment.”

    Mon Health System and WVUH have a strong working relationship. I have personal and professional respect for Albert Wright and the stellar providers at WVU Medicine, who are our partners in many services like tele-neurology/stroke, neonatology, nephrology and others. But, I also want to ensure the record is clear that Mon Health wants to be included in solutions for Fairmont and that our Certificate of Need application to build a hospital there is fairly reviewed in Charleston and that equal access, choice and balance in the market is preserved.


    Article by David Beard, The Dominion Post