Remington Capital – Joel A. Nathanson

The majority of institutional equity that has been raised over the last 3 years, was to purchase distressed notes. These distressed notes are made up of  a combination of preforming and non-preforming assets. Unfortunately, for the large private equity funds the number distressed notes hitting the open market is minimal compared to their initial expectation. The major reason, banks have continued to “extend & pretend” the current notes as long as they are cash-flowing assets and can service the debt. For the properties that banks won’t negotiate on, the only option is to recapitalize or be forced in to foreclosure. Remington’s Distressed Property Recapitalization Program (DPR) is the best option for property owners that are in this situation. With this program, we can work with our over 500 capital relationship to bring all parts of the capital stack to the table and find a viable solution.

In today’s market I continually see positive signs.  I’m pleased to report that our Capital Markets Group at Remington has successfully secured funds that we are deploying to clients.  It is a welcome change from 2009, and I’m bullish on 2010 not only because of our fast start but because of several factors.

One factor that points to a much better 2010 is the help we’ll receive from foreign investors. Did you see this article in MBA Newslink?  http://www.mortgagebankers.org/tools/FullStory.aspx?ArticleId=10327#full

There will continue to be a strong flow of foreign money into the U.S. commercial real-estate market over the next 3-5 years. This is happening for a number for reasons.

One reason is that property values in the US are down anywhere from 35-50% from the peak in late 2007, creating many excellent investment opportunities in prime markets.

Another reason is that the US currency continues to be devalued against other world currencies, making investing in the US relatively even more valuable for them.

According to the article, foreign capital will be dispersed mainly via equity plays, but many foreign investors will consider some debt opportunities.

Remington has a significant position in the US and around the world. Whether you’re a broker here or there, let’s talk about the opportunities to get your transaction completed this quarter.

Thank you – Joel Nathanson, Remington

In MBA Newslink today I was reading this article:  http://www.mortgagebankers.org/tools/FullStory.aspx?ArticleId=9213#full, and I’m not surprised that the rest of the world is following the US policy on trying not to push properties that are in breach of loan agreements into foreclosure.

A foreclosure for a lender can be a very time extensive and possibly a very expensive process. Due to the costs involved and possible liability exposure it can be much easier for a lender to sell the note at a significant discount, or allow the client to sell the distressed property.

This is an overall effort to of working with financial institutions and allow the credit markets to begin to open up. Even with a large influx of cash in the capital markets, banks are required to keep more cash on hand for their toxic loans.  I believe the best opportunity for brokers is to help investors with cash-find equity-like returns with minimum risk.

I work with brokers daily on doing just that. We have access to hundreds of actively-lending capital sources for hard money financing, senior debt financing, mezzanine financing, bridge financing and much more.  We work on a global scale and can help brokers who are located anywhere in the world.

Thank you!  Joel Nathanson – Remington