Waterstone Capital Advisors Writes $1.1 Million Check to Defeasance Client

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Waterstone Capital Advisors, LLC a leading defeasance consulting firm, has just announced the payment of over $1.1 million to a West Coast client.

Waterstone Capital Advisors, LLC a leading defeasance consulting firm, has just announced the payment of over $1.1 million to a West Coast client.

"Waterstone's transparent approach to the residual value in defeasance transactions was obviously a huge windfall to the borrower," said Mike Schoenstein, a principal of the firm.

Defeasance is a process commercial real estate borrowers may need to go through if they are selling their property encumbered by conduit, or refinancing their CMBS loan. Defeasance releases the mortgage from the loan and allows the borrower to close the related sale or refinance the transaction.

Since its founding in 2004, Waterstone Capital Advisors has taken a transparent approach to the CMBS defeasance process. "We were one of the first to inform the industry of the hidden value in a defeasance transaction, and to share this hidden revenue with our clients," said Mr. Schoenstein. "We routinely write checks to our clients for their share of this hidden value at closing - rather than several years in the future."

The defeasance consultant, or its affiliate, can be the beneficiary of substantial income after a defeasance transaction has closed. "Our company discloses this additional revenue opportunity to our clients up-front, and shares this value with them at closing of the defeasance, or at maturity of the loan," he added. Although the steps to complete a defeasance transaction do not vary substantially, what does vary is disclosure about the 'back-end' revenue generated by the defeasance consultant, or its Successor Borrower affiliate.

About Waterstone Capital Advisors, LLC

Since its founding in 2004, Waterstone Capital Advisors has taken a transparent approach to the CMBS defeasance process by informing the industry of the hidden value in a defeasance transaction. The defeasance consultant, or its affiliate, can be the beneficiary of substantial income after a defeasance transaction has closed. Waterstone Capital Advisors discloses this additional revenue opportunity to its clients, and shares this value with them at closing of the defeasance, or at maturity of the loan.

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Steve Liadis
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