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Hollis Carter, a 23-year-veteran with a small business administration and a Hilco strategic alliance partner, joins Steve Katz on the Hilco Global Smarter Perspectives Podcast Series and James Keith, managing director at Hilco Real Estate.
OPTIMIZING RECOVERY VALUES IN THE FACE OF 504 LIQUIDATIONS DUE TO THE COVID-19 PANDEMIC
504 LIQUIDATION BEST PRACTICES
SBA-BEST PRACTICES IN PROBLEM LOAN MANAGEMENT
SBA-BEST PRACTICES IN DEBTOR WORKOUTS AND NOTE SALES
Hilco Real Estate (HRE)
helps clients monetize assets, optimizing the value of commercial properties. With over 200+ years of combined experience working alongside both lenders and investors in the sale and acquisition of every type of asset, our SBA advisory team is an industry leader.
Passive liquidation management can lead to missed opportunities for substantial recoveries, especially during rocky economic circumstances. Don’t allow real estate assets to become liabilities – we can expedite transactions for the SBA and CDCs, offering stable footing in this environment and ensuring unparalleled recovery opportunities.
More Than a Platform
History of Success
Small Business Administration Engagements
TOWNEPLACE SUITES BY MARRIOTT
Hilco Real Estate (HRE) was retained to market the Sheriff’s sale of an 88-room Marriott hotel in Vincennes, IN. There were several hurdles to manage at the onset of this sale process, including: worried investors about its new owner’s PIP and franchise transferability of the license; decreased revenue due to COVID-19; limited ability of investors to properly review due diligence on a transaction of this caliber; and strict purchase contract requirements due to the nature of the sale. To overcome these challenges, HRE identified a stalking horse bidder to set a floor price to open the auction. Once the auction was completed, HRE worked directly with the winning bidder to solidify Marriott’s franchise approval in order to obtain financing.
The property sale resulted in a $6.5M sale price with zero contingencies and 10 days closing.
ZOOMERZ AUTOMOTIVE FACILITY
This property was bought by the SBA in a protective bid situation via foreclosure. The SBA contacted Hilco Real Estate (HRE) to market this fully-equipped automotive repair shop as part of an online auction. Halfway through the marketing campaign, a pre-auction offer, with a non-refundable deposit, was presented two weeks before the auction date. The Seller accepted the offer, and HRE successfully closed the property 30 days later.
The SBA received a full 100% recovery with excess funds to the borrower.
HISTORIC STATE-OF-THE-ART FEEDMILL
Hilco Real Estate (HRE) was retained to sell a complex feed mill property in Mocksville, NC that had ceased operations in 2020. Although it had significant maintenance issues, equipment as fixtures to the real estate as well as the seller’s financial difficulties maintaining lender obligations and physical property – all on top of having been previously under contract with no final closing, HRE quickly identified alternative solutions to overcome these matters. Leaning on existing legislation for new food manufacturing/processing plants in the state, HRE determined a targeted buyer pool of like-users who would find value in the existing operating space. The team determined a full-scale campaign targeting markets within an accelerated process, thus resulting in a successful 90-day marketing campaign and sale for $2.73M.
With HRE’s intervention, the lenders were paid in full and the seller’s net proceeds exceeded $750,000.
Former Country Oaks Golf Course
Hilco Real Estate (HRE) was contacted by a client one week away from the foreclosure sale of a 98± AC golf course located in Athens, Texas. The borrower previously tried to market the property but was unsuccessful in finding a buyer at which point the client reached out to HRE to lead a sale program. Through thorough market analysis, HRE determined that due to the upward trending market appreciation in residential property values in the property’s surrounding local area, its highest and best use was not as a golf course, but as land for residential development.
Due to the scheduled foreclosure sale, HRE immediately contacted existing residential developers contacts in our proprietary database, and WITHIN THREE DAYS, a cash buyer was secured. HRE was able to postpone the foreclosure sale, and after 45 days, the property successfully closed.
Before HRE’s involvement, all parties involved were looking at a total loss. However, through HRE’s efforts, this property sale resulted in a 100% recovery (principal plus interest) for the client with excess funds to the borrower.
Country Inn & Suites
This property, located in Owensboro, Kentucky, was part of a bankruptcy filing. The Third Party Lender (TPL) was seeking to lift the bankruptcy’s automatic stay order to continue foreclosure proceedings, gain possession and sell the property. For this, the TPL made a petition to the bankruptcy court to have Hilco Real Estate appointed as the marketing company to sell the property. The petition was granted and HRE, along with the TPL attorney, worked together to market the property through a national marketing campaign. HRE’s national marketing platform brought interested parties from five different states, with the winning bidder coming from out-of-state. The property was sold on site, all-cash, with a 30-day closing.
The sale resulted in a 70% recovery for the SBA.
The CDC contacted Hilco Real Estate to review this Laredo, Texas property. The property was being foreclosed by the TPL. HRE performed a broker opinion of value (BOV) and determined there was substantial equity for the SBA. HRE then contacted the owner (debtor) and recommended that he participate in an auction. HRE communicated with the TPL who agreed to postpone the foreclosure. HRE’s targeted marketing strategy generated a winning out-of-state bidder as part of a successful online auction process.
The property sale resulted in an 80% recovery for the SBA.
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