 |
 |
Commercial Case Studies Case Study #13: Detroit, MI Property Details Type of Property: Apartment Building Year Built: 1929 Class: C Units: 47 Square Footage: 28,000 Occupancy: 95% NOI: $137,200 Cap Rate: 14% Situation The owner had a total outstanding debt of $1,200,000. The current market value (CMV) on the property was $980,000. The owner received an unexpected electric bill for $80,000 for a faulty meter reading and went into default on the loan. Objective Purchase the existing loan at a discount for cash, restructure the owner's debt and provide long-term conventional financing for a take-out while not disturbing the existing tenants. Solution Negotiate and purchase the loan for $400,000 after which time, modify the owner's debt from $1,200,000 down to $512,000, realizing a $688,000 principal debt reduction! The owner carries a 12-month bridge loan at 15% interest after which time obtains a refinance loan at 55% LTV for $550,000 at 7.5% interest, 25 year amortization with a 15 year balloon.  Case Study #19: El Paso TX Property Details Type of Property: Shopping Center Year Built: 1967 Class: C Units: 11 Square Footage: 15,000 Occupancy: 70% NOI: $132,000 Cap Rate: 12% Situation The owner had a total outstanding debt of $1,650,000. The current market value (CMV) on the property was $1,100,000. Due to a decrease in market rents and lower occupancy, the owner could no longer service the existing debt structure. Objective Purchase the existing loan at a discount for cash, restructure the owner's debt and provide long-term conventional financing for a take-out while not disturbing the existing tenants. Solution Negotiate and purchase the loan for $643,500 after which time, modify the owner's debt from $1,650,000 down to $715,000, realizing a $935,000 principal debt reduction! The owner carries a 6-month bridge loan at 14% interest after which time obtains a refinance loan at 65% LTV for $715,000 at 6.5% interest, 25 year amortization with a 5 year balloon. Case Study #31: Raleigh, NC Property Details Type of Property: Office Building Year Built: 1984 Class: A Units: 21 Square Footage: 20,000 Occupancy: 58% NOI: $211,440 Cap Rate: 8% Situation The owner had a total outstanding debt of $3,850,000. The current market value (CMV) on the property was $2,643,000. Due to a decrease in market rents and lower occupancy, the owner could no longer service the existing debt structure. Objective Purchase the existing loan at a discount for cash, restructure the owner's debt and provide long-term conventional financing for a take-out while not disturbing the existing tenants. Solution Negotiate and purchase the loan for $1,665,000 after which time, modify the owner's debt from $3,850,000 down to $1,850,000, realizing a $2,000,000 principal debt reduction! The owner carries a 9-month bridge loan at 15% interest after which time obtains a refinance loan at 70% LTV for $1,850,000 at 7.25% interest, 20 year amortization with a 10-year balloon. Case Study #23: Denver, CO Property Details Type of Property: Apartment Complex Year Built: 1990 Class: B Units: 322 Square Footage: 225,000 Occupancy: 75% NOI: $650,000 Cap Rate: 10% Situation The owner had a total outstanding debt of $9,500,000. The current market value (CMV) on the property was $6,500,000. The balloon came due and the existing lender did not want to renew the loan and offered a discount on the note. Objective Purchase the existing loan at a discount for cash, restructure the owner's debt and provide long-term conventional financing for a take-out while not disturbing the existing tenants. Solution Negotiate and purchase the loan for $3,900,000 after which time, modify the owner's debt from $9,500,000 down to $4,550,000, realizing a $4,950,000 principal debt reduction! The owner carries a 4-month bridge loan at 13% interest after which time obtains a refinance loan at 70% LTV for $4,550,000 at 6.0% interest, and a 30-year amortization with a 10-year balloon. We Respect Our Clients Confidentiality. MFG Capital Group has policies in place which are designed to maintain the confidentiality of your workout or restructuring transaction. Because of this we do not release the names, contact information, or property addresses of our clients. Critical details which may be used to determine who a property owner is have been changed on this site and in other materials provided by MFG Capital Group. Because of this all photos and or images used on this site are representative rather than actual photographs. |
|
|
