Election Day has come and gone, although the voting has been going on for some time in this pandemic-influenced election season, with more than 101 million Americans having cast early or mail-in votes prior to yesterday. While the votes have been cast, not all of them had been counted on Election Day, and the country woke up Wednesday not knowing whether Democrat Joe Biden would be their next president, or whether Donald Trump had been re-elected.
But through the haze of the presidential race, one thing became clear: Democrats were deeply disappointed. The “blue wave” that many hoped would make this a statement election did not materialize. In fact, it was not much more than a fizzle. As Politico writer Ryan Lizza noted, “[t]his is not the outcome Democrats expected.”
At this point, Senate Republicans appear poised to maintain their majority, with Kentucky Senator Mitch McConnell, who won reelection yesterday, remaining in control of the Senate as Majority Leader. Republicans also appear to have improved their numbers in the House of Representatives, defeating Democrat incumbents in South Florida, New Mexico, Oklahoma and South Carolina. At the same time, they managed to fend off Democratic challengers to their incumbents who had been deemed vulnerable.
Democrats needed a net gain of four seats to take control of the Senate. Going into this week, Democrats were competitive and hopeful that their candidates could prevail in at least 10 races: Arizona, Colorado, Georgia, Iowa, Kansas, Maine, Montana, North Carolina, South Carolina and Texas. Thus far, they have won in only two: Arizona and Colorado. Arizona Senator Martha McSally lost to former astronaut Mark Kelly, and Colorado Senator Cory Gardner lost to former Colorado Governor and erstwhile presidential candidate John Hickenlooper. Gardner had been a strong supporter of NAIOP and the commercial real estate industry since he won his first race for Senate in 2014, speaking twice to our members at our annual Chapter Leadership and Legislative Retreat in Washington, D.C.
Democrats also lost a seat in Alabama, with Democrat Doug Jones losing to Republican Tommy Tuberville, and may also lose another seat in Michigan where incumbent Democratic Senator Gary Peters is neck and neck with Republican John James. While some races have not yet been officially called, and a Georgia Senate seat will be determined in a runoff election in January, a Democratic takeover of the Senate appears less likely.
The results in the Senate races seem to support what some political writers noted was a decline of ticket-splitting by voters, meaning that the party of the presidential candidate winning the state would also determine the party which won the senate race. Biden won Colorado and appears to have won Arizona, and Democrats won those Senate races. The exception seems to be Susan Collins in Maine, where Biden won but where Collins is leading in the vote count.
Of course, control of the Senate for Republicans is critical if Biden ultimately wins the presidency. The impact on the likelihood of Congress moving on a much-needed stimulus bill during the lame-duck session over the next few weeks, however, is hard to predict. Trump has signaled court challenges if his claims to winning the election are not accepted, which means possible gridlock until that is played out. But the economy faces severe challenges between Election Day and a presidential inauguration in January, with thousands of layoffs in the travel and hotel sectors already announced. And Congress must pass a continuing resolution to fund the government by Dec. 11 to avoid a shutdown. That may be enough to ensure some legislation is passed before year-end.
There were numerous important elections across the nation in addition to races for federal office. Ballot initiatives having a major impact on businesses if adopted, and on commercial real estate in particular, were before the voters in several states. In addition, several states had legislatures with vulnerable Republican majorities where Democrats were hopeful of taking control. Because the 2020 census would require a state’s legislature to redraw its congressional districts, control of the legislature allows the party in power to draw districts more favorable to that party. The results of the elections at the state level, and their impact on commercial real estate, will be the subject of NAIOP’s next government affairs blog post.
