MBA Commercial Offers Short Sale Solutions for Distressed Commercial Properties to Avoid Foreclosure

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Commercial property owners can avoid foreclosure by selling their property using a short sale. MBA Commercial has cash buyers available to relieve commercial real estate owners of unserviceable debt. Owners can save their credit by participating in a short sale versus a foreclosure.

"MBA Commercial’s access to ready buyers and ability to quickly and efficiently complete short sales on behalf of distressed property owners can significantly reduce damage to credit."

MBA Commercial, one of San Diego’s premiere commercial real estate brokers, has cash buyers available to relieve commercial real estate owners of unserviceable debt. Owners can save their credit by participating in a short sale versus a foreclosure. Lenders net approximately 15-20% more through a short sale than a foreclosure, providing them with incentive to satisfy a larger portion of debt.

According to MBA Commercial CEO Brian Yui, “MBA Commercial’s access to ready buyers and ability to quickly and efficiently complete short sales on behalf of distressed property owners can significantly reduce damage to credit.”

As MBA Commercial, Inc. predicted in late 2009, the wave of commercial foreclosures in San Diego is increasing. Researcher Real Capital Analytics Inc. reported that at the end of March 2010, San Diego County had 120 commercial loans in delinquent or default status, with a total value of $1.8 billion. According to Bloomberg L.P., in the first quarter of the year, 24.9% of San Diego’s commercial mortgage backed securities loans were on watch lists as lenders anticipated near-term delinquencies. In response to this growing need, MBA Commercial has established a short sale unit comprising experienced negotiators and closers dedicated to assisting commercial property holders dispose of their non-performing assets.

The model is similar to residential short sales: For commercial owners carrying debt higher than the current value of their properties, MBA Commercial can provide a cash buyer for fair market value. MBA then negotiates with the lender to release the owner’s note for the value of the sale, even though the owner owes more than the property is worth. The owner of the building avoids foreclosure and the bank avoids the legal fees and carrying cost associated with a foreclosure. The lender ultimately nets more money and avoids the risk of taking title to the property.

In addition to short sales, MBA Commercial specializes in short payoffs. The company has bridge financing lenders who are able to loan the majority of loan payoff amounts. Bridge financing costs are generally two to five points with interest rates ranging from 12-15% depending upon securitization and assumption of risk. Much like choosing a short sale over foreclosure, short payoffs can save a commercial property owner’s credit as well reducing or eliminating personal guarantees.

MBA Commercial has long anticipated the downturn in San Diego’s commercial property market and is now poised to assist owners in debt while generating profits for investors. Says Yui, “These individuals become free of the debt they can no longer service and the properties are restored to profitability, benefiting the local economy. It’s a win-win, something we don’t often see in the current market.”

MBA Commercial, Inc. is a leader in San Diego commercial real estate. MBA Commercial offers a turn-key solution for property management, leasing, sales and financing. Its new Short Sale Division provides bridge loans as well as short sale opportunities for commercial property owners. For further information, please call 888-248-6222.

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Brian Yui
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