Tag Archives: Commercial

The New Commercial Real Estate Economy is Here

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Clearwater, FL (Vocus) August 22, 2010

As the new industrial true estate economy continues to trudge forward on its hopeful path to recovery, proof of a new way of performing organization is evidenced by reports which show that the total workout activity (loan modification) for distressed commercial actual estate loans for the duration of the initial half of 2010 reached $ 29.2 billion. That is an increase of $ 14 billion of restructuring activity more than the $ 15.two billion for the first half 2009.

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Ira J. Friedman, Chief Operating Officer for Guardian Solutions, a commercial loan modification firm based in Florida, stated What we are seeing on the component of lenders and particular servicers is an enhanced openness to address the restructuring of CMBS loans when presented with professionally crafted proposals. Due to the ongoing deterioration of the industry, and since of our typical dealings with lenders and particular servicers, we are now far more able to swiftly move through the process of commercial loan restructuring.

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The continued stabilization of the real estate market has grow to be increasingly dependent on the re-pricing and deleveraging of property positions, the Genuine Estate Analysis Corporation (RERC) reported lately.

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Broader problems such as restricted gross domestic solution development, continued high unemployment rates, and the likelihood of new federal regulations will force the market place to further evaluate the lengthy-standing formulas and assumptions they have traditionally employed to price tag industrial genuine estate. The special servicers, who manage (CMBS) industrial properties in or facing default, have similarly, had to reevaluate their usual way of transacting with distressed properties that come into their hands.

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Significant challenges lay ahead for industrial true estate, which includes the uncertainty connected to the use of valuations such as cap prices and comps the manner in which these metrics are employed, directly impact the outcome of proposed commercial loan restructures and subsequently will influence a industry recovery.

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The types of mortgage restructuring we are seeing get approved consist of each term extensions and mortgage discounted buyouts, added Friedmanwhile we naturally take into account the needs of the house owner, we clearly address the concerns of the specific servicers in order to get these offers completedit has to be a win-win outcome..

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Since of the changing landscape of commercial actual estate and other aspects that have evolved in the capital markets more than the previous numerous years, the method to analyzing, investing, managing and restructuring loans for industrial properties will also require to evolve beyond the status quo of earlier years.

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For industrial loans from 2006-2008, the lax underwriting standards of that time period, lack of amortization, low capitalization rates, the disastrous domino effect of the weakened economy and reduced market liquidity will all probably to lead to larger loss severities.

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The commercial loan modification approach is very selective, with some banks, lenders and unique servicers electing to take back properties, sell them at a loss and take them off their balance sheets. But other properties which meet the new criteria for loan restructuring, and are represented with the submission of compelling exercise proposals, will be modified and kept on the books.

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Property owners are increasingly experiencing the fallout of this damaged economy and are faced with two choices: holding onto a non-performing asset or foreclosure. Guardian Solutions is in a position help commercial property owners restructure their loans by very first correctly evaluating an owners asset functionality and industry possible. Based on that data and other analytical information we compile, and our very first-hand knowledge receiving these modifications completed, we develop a comprehensive restructuring proposal, concluded Friedman.

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About Guardian Options&#13

Guardian Solutions is the one particular of nations biggest industrial loan restructuring companies and is committed to assisting commercial house owners save their properties. The companys knowledgeable mitigators are skilled in a range of disciplines to offer customized restructuring options. For a lot more details, go to http://www.GuardianSolutions.org

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Make contact with:&#13

Jamie Sene&#13

Vice President, Marketing&#13

Guardian Options&#13

727-442-8833&#13

jvs(at)guardiansolutions(dot)org&#13

http://www.GuardianSolutions.org

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Lengthy Road to Recovery: Many Obstacles Nonetheless Lie in the Path to Commercial Genuine Estate Stabilization

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Clearwater, FL (Vocus/PRWEB) December 28, 2010

Commercial true estate industry specialists are cautiously hopeful for hints of a stabilization across the nonetheless unsteady commercial property industry. As the 4th quarter of 2010 comes to a close, experts are cautious to determine a number of outstanding, lingering elements that need options before a a lot more secure stabilization can be realized.

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A recent report published by Deloitte said, Despite some encouraging activity, even so, impediments such as looming debt maturities and higher unemployment prices are causing uncertainty, dimming prospects of a robust, short-term rebound.

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We are seeing much more commercial mortgages in distress each week. Corroborating our personal findings, we lately received a report from the nations top credit rating agency, Regular &amp Poor, which stated, At the end of the third quarter, $ 46.eight billion in CMBS loans have been delinquent, or 8.32 %. mentioned Ira J. Friedman, President of Guardian Options, a commercial loan restructuring firm based in Florida.

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Among the numerous difficulties facing CMBS loans in the next 12 months, 1 of the most notable things are the substantial quantity of loans that are maturing in 2011. Despite the fact that lenders have appeared to loosen some of their a lot more conservative prospects heading into the 4th quarter, possibilities for standard refinancing nevertheless remain bleak as numerous home owners scramble to discover options for impending 2011 balloon payment due dates.

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Additionally, apartment rental properties will locate themselves supplying continued concessions over the next several successive quarters. As new building remains at a standstill in several main metropolitan areas, competitors for renters may continue its warm streak in early 2011. Despite the fact that actual occupancy rates could show indications of stabilization, most management firms will still uncover themselves offering substantial rental concessions in an effort to remain competitive.

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Even though a lot of industrial home management organizations may make the error of hunting to 2011 as the year exactly where all issues will turn around, others remain skeptical and comprehend that sitting about and patiently waiting for the upturn is not going offer a remedy-all for their ongoing income woes and impending commercial loan delinquencies.

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Friedman explained, Primarily based on many of the conversations Ive had with commercial true estate owners in the latter component of this year, 2011 does not appear to be a year of smooth or particular recovery in the commercial true estate sectorThere are just as well a lot of concerns lingering for house managers who continue to wrestle with record-high vacancies and stagnant valuations as the 4th quarter comes to a close.

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Jeramie Concklin, CEO of Guardian Options, elaborated additional by describing how his firm has enjoyed accomplishment with receiving lenders to lessen complete amortization payments to interest-only payments, at least for a couple of years. Weve noticed a couple of lenders and unique servicers who are becoming more proactive or remedy oriented express some willingness to give a discount on the principal for recourse loans, added Concklin.

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In other conditions, borrowers continue to struggle with steep house devaluation troubles. Usually occasions, loans that originated in 2006-2007 had been primarily based upon the inflated values of the credit bubble. Now, in the years following the credit/economic collapse, property owners are left with devalued assets that can no longer support the debt service needs established 4 to 5 years ago. As this concern remains prominent by way of the close of 2010, one particular should look ahead on the valuation projections of 2011 with intense caution.

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Borrowers have also looked to commercial loan modification firms for help with note sales or discounted payoffs. Friedman adds, Toward the close of the 3rd quarter, we had a single client who came to us with a property in default and struggling with devaluation issues. Regardless of his trouble, our client, J.P., had a purchaser interested in acquiring his distressed asset.

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With Guardian Solutions support, J.P. was able to effectuate the sale of his struggling Connecticut home, and make a profit as properly. According to J.P,Guardian Options was effective in acquiring by way of to our lender and effecting a payoff agreement that removed us from an overshadowing devaluation problem. Without their efforts, we may possibly not have been able to secure a sale of our house, which permitted us to net a profit on a house already in special servicing.

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Commercial house owners who are trying to restore their performing assets are seeking assist from firms like Guardian Options that specialize exclusively in industrial loan modification. Presently, there are only a handful of specialized firms that employ extremely qualified personnel, such as accountants, MBAs and actual estate professionals to deal particularly with the complexities involved in a commercial loan restructuring strategy.

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About Guardian Options&#13

Guardian Options is the one of nations largest commercial loan restructuring firms and is committed to assisting industrial home owners save their properties. Guardians client-base far more than doubled in 2010 alone, as far more property owners discovered about the successful methodology that Guardian employs to set struggling assets on the road to recovery. The companys knowledgeable mitigators are experienced in a selection of disciplines to supply customized restructuring options. For a lot more info, visit http://www.GuardianSolutions.org&#13
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Get in touch with:&#13

Jamie Sene&#13

Vice President, Marketing and advertising&#13

Guardian Solutions&#13

727-442-8833&#13

jvs(at)guardiansolutions(dot)org&#13

http://www.GuardianSolutions.org

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Objective and Thorough Property Valuation Evaluation Is Crucial To Successfully Negotiating With Commercial Mortgage Lenders According to Kevin M. Levine

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Woodland Hills, CA (PRWEB) March 21, 2011

An objective and thorough house valuation evaluation is the important to a profitable negotiation with industrial real estate mortgage lenders, stated Kevin Levine, Executive Vice President of Strategic Asset Solutions/Peak Asset Options of Woodland Hills, California. Several distressed loan borrowers think that they can submit just any proposal to modify the loan or conduct a quick sale of the house, Levine stated. And numerous potential actual estate investors submit delivers to obtain mortgaged properties or buy mortgage loan notes from lenders at really low prices. Sometimes those proposals are successful but generally they are summarily rejected by the lender.

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Levine explained that borrowers or potential purchasers usually submit a very low figure proposal, believing that will smoke out the lender and stimulate a counter provide. That response doesnt happen extremely often, he said. A lender usually avoids, in impact, bidding against itself. Levine explained that the lender need to be convinced the proposed loan modification, brief sale or note purchase will make an end result at least equal to what the lender will comprehend upon foreclosure. This can only be carried out by supplying the lender with a quite thorough house valuation evaluation, Levine stated.

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We devote considerable time and work gathering existing industry information and operating data about the house. If there are tenants, we analyze their rental rates in comparison with industry prices, he stated. Important elements relating to tenants are the remaining terms of their leases, the likelihood of renewal, and their anticipated rental renewal prices which may effectively fall below the existing prices. So even if the occupancy is fairly higher now and the property is producing sufficient earnings to service the debt, taxes and maintenance, that may possibly not be the case in a few months.

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Levine commented that properties occupied by the borrowers operating organization need an examination of the company economic functionality. The home owners enterprise could be declining swiftly in this economy, Levine added. In such a non-arms length situation, the enterprise will not be in a position to pay the contracted rent. An option and realistic rental price most likely will be drastically lower, diminishing the value of the house.

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Levine stated that lenders usually welcome and appreciate receiving an objective and thorough valuation analysis. They typically then will have the house reappraised but the valuation evaluation we give them creates a benchmark and provides a basis for contesting the reappraised value if that becomes needed.

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Strategic Asset Solutions/Peak Asset Solutions delivers commercial loan modification and brief sale services in California and all through the country. The companys personnel bring in depth industrial real estate experience to every single assignment, such as market analysis, valuation, legal, and negotiation encounter. Each borrowers unique lending situation is completely analyzed, and the borrower is assisted in preparing current operating reports and projections. Then Strategic Asset Solutions/Peak Asset Solutions drafts and submits to the lender a loan modification proposal. That proposal could contain a principal reduction, interest price reduction, and waiver of penalty charges. In those situations exactly where a loan modification will not function to the mutual advantage of the borrower and lender, Strategic Asset Solutions/Peak Asset Options will try to broker a quick sale of the commercial actual estate at a significant discount from the loan balance, or will seek to negotiate a sale of the note to a third-party.

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Strategic Asset Options/Peak Asset Options is a member of the Peak Corporate Network headquartered in Woodland Hills, California. In addition to industrial loan modifications, the Peak Corporate Network provides mortgage lending, loan servicing, residential quick sale, 1031 exchange, trustee operate, foreclosure solutions, and true estate sale brokerage solutions. These solutions are available mostly all through the Western United States for each residential and industrial real estate properties and loans.

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Commercial Loan Workout Specialist Breakwater Equity Partners Passes $1 Billion in Loan Workout Volume

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San Diego, CA (PRWEB) March 28, 2011

Breakwater Equity Partners, a consulting firm specializing in commercial loan workouts, right now announced the firm has surpassed $ 1 billion in total loan exercise volume. The 21-person firm, positioned in San Diego, CA, has been doubling each and every ninety days to accommodate the increasing demand for industrial loan modifications.

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Breakwater Equity attributes its quickly development and accomplishment to the hands-on encounter of its team, with more than 180 workout assignments completed or in progress. Breakwater utilizes a diverse group of specialized authorities in the fields of finance, bankruptcy, banking, genuine estate law, litigation management and negotiation. Its a bittersweet success story, stated Phil Jemmett, CEO of Breakwater Equity Partners. Whilst we are not excited about the state of the economy and the downturn in the true estate market place, we are enthusiastic about the chance to help home owners and investors save their troubled properties and resolve their private guarantees. All of our customers are dealing with a high level of financial and emotional discomfort, as the true estate collapse has destroyed years of difficult work and produced an uncertain future.

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Breakwater has performed a wide selection of industrial loan workouts on the way to $ 1 billion, from single asset workouts on $ 1 Million loans, to multi-asset real estate portfolios exceeding $ one hundred Million (minimum loan size is now $ five Million). The business has worked on just about each and every genuine estate asset class in a wide selection of places across the U.S. like office buildings, industrial, retail, from strip centers to huge shopping malls, multi-loved ones residential, mixed use, master-planned communities, broken construction projects, residential and land development, golf courses, farming operations and manufacturing facilities.

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We see no instant finish to the limited availability of credit, stated Armand Nicholi, CFO of Breakwater Equity. The banking business is not healthful right now. Every single day we come across banks that are refusing to recognize the extent of their credit losses. Banks arent coming clean with regulators, investors, or the public. The negative loans are clogging up the economic method, and unless we face up to this difficulty we are going to be where Japan was back in the 1990s. Soon after the last actual estate melt down, the RTC liquidated all the bad debts it was very painful, but it cleaned up lender balance sheets, restored the credit markets, and swiftly permitted the economy to get back on its feet. We dont appear prepared to go by means of that procedure this time around, so the discomfort will continue. The genuine estate market will not return to normal situations until credit is offered on commercially-reasonable terms.

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Breakwater also has been working on TIC (tenant-in-typical) loan workouts and is the consulting group managing the Met Center ten office creating workout in Austin, Texas, which has been at the center of controversy over Grubb &amp Elliss judgment of fraud and gross negligence in their dealings with and disclosures to TIC investment members as reported in the Wall Street Journal (Ruling Gives a Peek Into Boom’s Fallout – Anton Troianovsky, December 22, 2010).

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According to our study there are over $ 1.7 Trillion in commercial true estate loans that will be maturing by 2015, $ 1.1 Trillion of which will likely be beneath water, continued Phil Jemmett. We dont see the commercial genuine estate market improving significantly in the course of the subsequent handful of years. With sluggish job growth, growing oil rates, a declining housing marketplace, ballooning government debt, and tight credit, it seems unlikely that the industrial marketplace will recover in the close to term. As these underwater loans hit maturity, an orderly debt restructuring method is in the very best interests of each borrowers and lenders. We believe industrial loan workouts are the most efficient way of resolving these troubles, and an efficient option to uncertain, pricey, and lengthy bankruptcy and litigation processes.

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About Breakwater Equity Partners&#13

Breakwater Equity Partners is a privately-owned actual estate consulting firm located in San Diego, CA, providing industrial loan exercise techniques and negotiation services to property owners and investors all through the U.S. The Breakwater group, consisting of specialists in finance, banking, genuine estate and law, has worked on over 175 commercial loan workouts throughout the US, with deep experience in a wide variety of true estate classes, such as office, industrial, retail, multi-family, mixed use, master-planned communities, residential and land development, golf courses, and farming operations. Breakwater also specializes in Tenant-in-Widespread loan workouts. For much more info on Breakwater Equity Partners, please get in touch with 858-490-3630 or pay a visit to http://www.breakwaterequity.com. Study our industrial loan exercise blog at http://www.breakwaterequity.com/weblog.

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Media Make contact with&#13

Victoria Cunningham&#13

victoria(at)breakwaterequity(dot)com&#13

858-490-3630 x112

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Peak 1031 Exchange, Inc. Gives Capital Gains Tax Liability Help on Commercial Property Foreclosures

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(PRWEB) February 28, 2012

Commercial real estate owners on the foreclosure track could potentially incur stiff tax liabilities in addition to the loss of their investment, stated Kevin M. Levine, Executive Vice President of Peak 1031 Exchange, Inc. (http://www.peakexchange.com), a Qualified Intermediary, unless they take into account all the outcomes of relinquishing the asset. Industrial owners could have factored in all variables when exiting a commercial endeavor, but the IRS is the crippling X factor that exponentially amplifies the loss of the asset.

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Relying on current information estimating that roughly $ 360 billion in commercial debt will mature in 2012, Levine estimates that some owners will either not be able to restructure the debt sufficiently to retain the asset nor be capable to function out a answer with the lender. Simply because many of these loans are written as non-recourse loans safeguarding the borrowers personal assets in the event of a default, Levine continues, borrowers dont aspect in the impact of the computed loss on the foreclosed commercial asset being classified for capital gains purposes. Most borrowers are unprepared for this. The IRS categorizes the loan amount deficiency — that is, the remaining balance among the tax basis of the property in query and the balance of the unpaid loan — as a realized obtain for tax purposes.

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Although Levine admits that at some point capital gains taxes owed should be happy, exchanging the property in a 1031 exchange is not only inventive, but allowed under the existing tax code to defer capital gains taxes. The 1031 exchange route presents a feasible alternative to distressed industrial borrowers seeking a strategic exit from the liability with an eye to mitigating future tax liabilities. In order for the exchange to a valid, nonetheless, the borrower have to sign over the title to the 1031 exchange Qualified Intermediary ahead of the house is sold at auction, and the interested purchaser must be produced conscious that title is held by the Intermediary.

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The volatility of the past cycle is beginning to stabilize, revealing new opportunities for industrial genuine estate investors, says Levine, even in the arena of investors incurring a loss of equity or total loss of asset. Minimizing or deferring any possible tax liability through the 1031 exchange approach is one way of putting investors back on the road to recovery.

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Peak 1031 Exchange, Inc. is one particular of the entities in the Peak Corporate Network headquartered in Woodland Hills, California. In addition to industrial loan modifications, the Peak Corporate Network entities offer you mortgage lending, loan servicing, brief sale solutions, foreclosure solutions, actual estate brokerage and escrow solutions. For a lot more details, check out http://www.peakcorp.com.

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The Peak Corporate Network is a brand that represents a group of associated separate legal entities, every delivering its exclusive set of true estate services.

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A lot of Commercial True Estate Loans Now Coming Due Are Unable To Be Refinanced As Result of Declining Home Values

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(PRWEB) May 10, 2012

Declining commercial true estate home values have substantially reduced borrowers abilities to refinance their maturing loans, stated Kevin M. Levine, Executive Vice President, Peak Asset Options (http://www.peakassetsolutions.com). Several of those properties have been acquired through lender financing in the mid-2000s, at the height of the genuine estate boom, he stated. But now these loans with shorter-term maturities, due in five to seven years, are increasingly defaulting due to the refinancing barriers resulting from decreased home values. In several cases, the properties securing the loans are worth considerably much less than the loan balances.

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Levine explained that a borrower might have remained present in generating the loan payments. But if the loan has matured, the lender can’t renew or extend that loan without having creating a difficulty asset reserve against the portion of the debt that is now basically unsecured. This becomes a direct hit to the lenders earnings in the period in which the reserve is produced. And that identical worth decline prevents the borrower from refinancing the property elsewhere.

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Levine added that, Given the selection of renewing or extending the loan although producing the huge difficulty asset reserve, versus foreclosing, several lenders will elect to get in touch with the loan and foreclose. Then they are at least capable to achieve control of the house and take such actions as they deem ideal to begin to restore the worth.

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Levine pointed out that the borrower has a quantity of alternatives obtainable to it in such a predicament. The borrower can attempt to negotiate a brief sale of the house, he mentioned. But the lender will have to approve the sale price tag and, if there is a full recourse guarantor, settle the guaranty obligation as effectively. One more option that we usually advise is that we find a third party to purchase the loan at a substantial discount from the original lender. That third party then negotiates a reduced payment program with the borrower. Levine added that, if the borrower and lender cannot agree on a resolution, the foreclosure generally proceeds with the end result that the borrower loses the house.

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Brief sales and foreclosures negatively have an effect on the borrowers credit. And there can be federal and state tax liabilities for the borrower in addition to losing the property, Levine concluded.

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Peak Asset Options offers commercial loan modification and quick sale solutions in California and throughout the country. The companys personnel bring comprehensive commercial real estate experience to every assignment, which includes market analysis, valuation, legal, and negotiation expertise. Every borrowers unique lending predicament is totally-analyzed, and the borrower is assisted in preparing present operating reports and projections. Then, Peak Asset Solutions drafts and submits to the lender a loan modification proposal. That proposal could consist of a principal reduction, interest price reduction, and waiver of penalty charges. In these instances where a loan modification will not work to the mutual benefit of the borrower and lender, we will attempt to broker a short sale of the industrial true estate at a substantial discount from the loan balance, or will seek to negotiate a sale of the note to a third-party.

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Peak Asset Options is a single of the entities in the Peak Corporate Network headquartered in Woodland Hills, California. In addition to commercial loan modifications, the Peak Corporate Network entities provide mortgage lending, loan servicing, residential short sale, 1031 exchange, escrow solutions, trustee work, foreclosure services, and true estate brokerage solutions. For more info, visit http://www.peakcorp.com.

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The Peak Corporate Network is a brand that represents a group of separate legal entities, every single supplying its special set of genuine estate solutions.

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