No End in Sight for Real Estate Plight

Published on June 27, 2018

Retail Building for Sale

As FOR LEASE / FOR SALE signs continue to proliferate retail properties across the U.S., creditors are asking us:

What can we do to maximize returns from troubled retail real estate secured loans? 

In our two decades of professional experience representing lenders with troubled loans, we’ve learned that the best outcomes generally result from early actions:

  1. Consider the pros and cons of your alternatives, such as receivership, bankruptcy or out-of-court restructuring.
  2. Talk to your financial advisor and legal counsel to determine which solution makes the most sense for each troubled loan.
  3. Sit back as your retained Receiver/Trustee /CRO/Financial Advisor takes possession of the property and manages your exit via sale or refinancing.

How will your Receiver/Trustee/CRO/Financial Advisor get the best result? 

  • Leasing:  Oversees all aspects of negotiating extensions, renewals and terminations to maximize the property’s value. Analyzes, enforces and negotiates changes related to CC&Rs.
  • Accounting: Collects rent, pays property-related expenses and delivers detailed accounting to court and creditors.
  • CapEx:  Works with lender-client to establish minimum work required to maximize property’s value, including requisite cleaning and repairs per health and safety requirements.
  • Regulatory:  Interacts with city to clear any code violations.
  • Legal: Coordinates process to achieve court approval of a sale, including all court orders to fulfill escrow and title requirements.
  • Sale/Exit:  Hires and manages third-party agent and directs and approves all marketing activity.  Reviews and selects prospective buyers and negotiates purchase contract.

Our Retail Results

Fast Food RetailNational Fast Food Chain
Federal Bankruptcy Court
Multiple California Cities

  • Maximized rent collection.
  • Negotiated with chain’s corporate office to maximize lease term and value.
  • Maximized sale price by finding and hiring best-in-class agent who procured multiple offers.
  • Sold property above list price.

Vacant Big Box Retail CenterVacant Big Box Building
Federal Court Receivership

Los Angeles, CA

  • Maximized sale price by finding buyer whose re-use of property generated the highest residual purchase price for the building.
  • Negotiated conditional use permit with the City of Los Angeles and neighboring tenants to gain approval for the buyer’s re-use, which ultimately increased the property’s value by over $1 million.
  • Sold property, which had been vacant for over 5 years, for above appraised value.

Credit Tenants Occupying Retail PadsRetail Freestanding Pad
Federal Bankruptcy Court
Multiple Central California Locations

  • Maximized rent collection.
  • Interacted extensively with national tenants to maintain leases, negotiating lease extensions when required.
  • Maximized sale price by improving rent roll and finding and hiring best-in-class agent who  procured multiple offers.
  • Sold property above list price.

Vacant Single-user Retail  BuildingsNeighborhood Retail Stores
State Court Receivership

Long Beach, CA

  • Worked with City to clear all code violations and liens.
  • Filed all required motions to seek and attain court approval for the sale, free and clear of liens.
  • Worked with U.S. Attorney to clear federal lien and with title to deliver property free and clear of liens to buyer.
  • Maximized sale price by finding and hiring best-in-class agent who procured multiple offers.
  • Sold property above list price.

Neighborhood Mixed-use PropertySan Francisco Mixed Use Building
Federal Bankruptcy Court
San Francisco, CA

  • Maximized rent collection.
  • Filed all required motions to seek and attain court approval for the sale, free and clear of liens.
  • Led construction of roof and full remodels of multiple occupied and vacant units.
  • Worked with city to avoid complicated code compliance violation.
  • Created the ability to sell as owner-user property by negotiating termination of primary retail lease.

Contact David Kieffer to learn more.

 

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