Case Study #1

The Client:

An investment partnership

The Situation:

The investors, a partnership, owned multiple office buildings. The value of one of the buildings had fallen drastically and, in addition, required expenditures to repair extensive deferred maintenance. The investors owed the lender $4,362,000 principal and $157,000 interest. The investors’ goal was to effect a successful workout; and while the investors were sophisticated business persons, they lacked knowledge of the intricacies and complexities involved in the lender-negotiation process.

The Solution:

With a property under-water and under-maintained, the lender not only stood to lose on the loan, but would also have to pay for the cost of repairs and capital improvements. The investors turned to Peak Asset Solutions for debt resolution through restructure. We were able to negotiate with the lender to sell the existing note to a newly-formed limited liability company (LLC) that included the investors as members. The purchase price to the LLC was $2,150,000 resulting in a $2,212,000  savings to the investors and the elimination of their personal liability as partners.