Background:
As a result of a soft market and the relocation of a major tenant, a well known institutional investor experienced a rapid decline in cash flow on a Class-A high rise office building. The lender, a major life insurance company could only stand by and watch as the borrower defaulted on their loan. The lender foreclosed placing the property in bankruptcy. Our consultant was retained by the bankruptcy court to transition the property.
Activities Performed:
- Acquire all property records including leases, plans and specifications, permits, and all property computers, property and financial records including bank accounts containing rent proceeds, security deposits property tax reserves and other financial data.
- Replace owner’s property management team
- Stabilize building with tenants, vendors and marketplace
- Re-market available building space
- Report to bankruptcy court on all activities
Results:
- Successfully transitioned property to lender upon completion of bankruptcy process
- Transitioned over $1.5Million in rents during the process plus a lease cancelation fee in excess of $500,000.
- Lender retained services of the receiver after the bankruptcy to re-stabilize the asset and position it for immediate sale.
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Many of the challenges we face in the real estate sector are merely a repeat...