Success Stories

Investment Sales:

New Rochelle –
230 North Avenue

Abstract:

The property, a mixed-use building with rental apartments over retail, was in a foreclosure proceeding, as part of a multi-property, multi-note package of notes. The seller, a financial institution, wanted to maximize the sale proceeds but was uncertain as to how to proceed. While the property was in good condition, the sale notes market in the area was saturated, resulting in substantial discounts. Admiral advised the seller to hire a management company, stabilize the asset, and sell the fee position in the asset rather than the note itself. The seller achieved a price $300,000 higher than by selling the note, and benefitted from a year of operating income.

CHALLENGES:

  • The property was in good condition, but because the market for note sales at the time was saturated, note sales in the area were being executed at substantial discounts to asset value.

Solution:

  • The seller achieved a price $300,000 higher by stabilizing the property and selling the fee position rather than the note. The seller also took in income from the operation of the building for over one year.
  • To do so, the seller needed to take an active role in the management of the property. The appointment of a receiver stabilized the asset while the seller completed the foreclosure process.
  • We recommended a management company that enhanced the value of the property through aggressive management of the building, including exercising a physical plant inspection and the remediation of deferred maintenance items, increased on-site day-to-day management of the property, and better financial reporting.
  • The stabilization of the property also allowed time to lease the vacant ground floor commercial space, further increasing the property value.
  • The incremental revenue from the property’s stabilization and lease up more than covered the additional legal expense of the foreclosure.

Client BENEFITS:

  • The seller achieved a price $300,000 higher by stabilizing the property and selling the fee position rather than the note. The seller also took in income from the operation of the building for over one year.
  • To do so, the seller needed to take an active role in the management of the property. The appointment of a receiver stabilized the asset while the seller completed the foreclosure process.
  • We recommended a management company that enhanced the value of the property through aggressive management of the building, including exercising a physical plant inspection and the remediation of deferred maintenance items, increased on-site day-to-day management of the property, and better financial reporting.
  • The stabilization of the property also allowed time to lease the vacant ground floor commercial space, further increasing the property value.
  • The incremental revenue from the property’s stabilization and lease up more than covered the additional legal expense of the foreclosure.