These aren’t guys that manage from the sidelines. They lead from the front in a boots-on-the-ground, get-their-hands-dirty kind of way. When you have a property like Old Norcross that needs to be saved from financial ruin, you need...Allegiancy.
Richmond, Va. (PRWEB) August 04, 2014
With the fear of losing their multi-million dollar investment property and defaulting on their loan, owners of a Lawrenceville, Ga., office complex turned to Allegiancy, a commercial real estate asset manager, to save them from financial ruin in 2013. Less than one year later, aggressive leadership has saved them. Seriously.
Under the management of Allegiancy, the owners now benefit from more than $250,000 in improved performance, thanks to reduced loan costs and improved cash flow.
Located in a suburb of Atlanta, the $4.7 million, 62,000-square-foot Old Norcross property was previously under the supervision of an inattentive manager and had fallen steadily behind in its operating and earning potential.
Allegiancy takes a proactive approach to the commercial real estate properties it manages.
Tracy Turner, President of Turner Financial Group, who recommended Allegiancy to the Tenants In Common (TIC) ownership group, said: “The owners needed a company that would offer a firm hand, act immediately and treat the property like it was their own. Allegiancy takes swift action and understands the importance of and how to make low-cost, high-impact changes at a property. They not only turn a property around, but they also get it on track to become profitable again.”
“Allegiancy is the group I call on when I need a property rescued,” Turner said. “These aren’t guys that manage from the sidelines. They lead from the front in a boots-on-the-ground, get-their-hands-dirty kind of way. When you have a property like Old Norcross that needs to be saved from financial ruin, you need an asset manager like Allegiancy.”
At Old Norcross, Allegiancy had to act fast on multiple fronts – addressing deferred maintenance to attract tenants and convincing the lender that restructuring the debt would be worth the while.
“We worked out a modification on a loan extension because of Allegiancy,” said Charles Gonzalez, the lender for the property.
Specifically, Allegiancy helped negotiate an 18-month extension on the property loan, reducing the monthly loan payment by $8,000, saving nearly $100,000 each year.
“Their positive activity on the property and continued momentum with new leasing and extensions made that possible,” Gonzalez said. “This wasn’t possible with the previous management, who didn’t give leasing the attention it needed. Allegiancy knows what kinds of capital expenditures are needed to maintain the property to keep it headed in the direction of becoming an institutional investment.”
Allegiancy generated that positive activity and momentum after taking over by immediately replacing a lackadaisical property manager and ineffective leasing agent.
“Replacing these key positions was a first priority to start the turnaround,” said Dan Simons, Allegiancy’s chief operating officer. “In a small market, the quality and reputation of on-site management of a commercial property is crucial. And quite simply, we identify the best broker in the market, the brokers who know how to foster the kind of personal relationships that still drive many business decisions.”
Sluggish leasing efforts by the property’s previous asset manager were compounded by deferred maintenance on the property itself.
“Situations like this quickly create a downward spiral,” said Chris Sadler, Allegiancy’s president. “Poor leasing practice leads to bad financials, leads to deferred maintenance, leads to inability to lease. When we come in and quickly address all of the issues at once, we show the owners, lender and tenants that it’s a new day.”
Allegiancy addressed the issues with low-cost, high-impact solutions that improved curb appeal in support of the revitalized leasing effort.
The Allegiancy-led results
Old Norcross occupancy rates increased by 12 percent, up to 74 percent. This was thanks to a current tenant’s space expanding by more than 3,000-square-feet, and vacant spaces filling up with new tenants, including a company from the medical field who signed a seven-year lease on a more than 4,600-square-foot space.
As a result of the leasing activity, cash flow improved, increasing by $13,000 each month.
Old Norcross is not the first commercial real estate property Allegiancy has brought back from the brink of bankruptcy to potential bonuses for owners.
Allegiancy took over the real estate asset management of Signature Place, a large office building in Greensboro, N.C., that was once much like Old Norcross. Two major tenants there were owed $1.5 million for improvements they had made, and the property was in danger of defaulting on its mortgage. Today, Signature Place is performing well and building cash reserves.
Allegiancy also recently won new real estate asset management contracts in Florida, North Carolina and Ohio.
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About Allegiancy
Allegiancy is changing the business of asset management for commercial real estate owners and investors. With an advanced technology platform and singular focus on serving as the owners’ advocate, the company brings fresh vigor to an often poorly understood business. Combining its proactive Value Assurance? operational rigor with an intense focus on cash flow and profitability, Allegiancy is expanding on a track record of more than four decades of success.
Headquartered in Richmond, Va., and led by a team of seasoned professionals and more than 100 years of experience, Allegiancy manages properties that have outperformed their peers by 45% since 2006. The company has more than $300 million in assets under management (AUM) and delivers clients attractive returns and profitable, hassle-free investments in commercial real estate.
More information about Allegiancy may be found at http://www.allegiancy.us.
To schedule an interview with Allegiancy’s leadership, contact Audrey Bevel at audrey@allegiancy.us or 866.842.7545 ext. 204.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements are based upon the Allegiancy, LLC’s (the “Company”) present expectations, but these statements are not guaranteed to occur. Furthermore, the Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. Investors should not place undue reliance upon forward-looking statements. For further discussion of the factors that could affect outcomes, please refer to the “Risk Factors” section of the offering circular dated January 14, 2014 and filed by the Company with the U.S. Securities and Exchange Commission on January 15, 2014. The offering circular, and any supplements or updates thereto, is available on the EDGAR system located on http://www.sec.gov.