Memphis, TN (PRWEB) December 05, 2012
Breakwater Equity Partners, a commercial real estate workout firm, has assisted the tenant-in-common (TIC) owners in filing bankruptcy on Buildings A & B of the Lenox Business Park in Memphis, TN. One of the 32 TIC owners put his LLC into bankruptcy so that the special servicer could not foreclose on the two Class A office buildings.
The investors purchased Lenox A & B for $23.5MM in 2007. The two buildings are part of a seven-building office park and were 95 percent occupied at the time of purchase. The buildings are now less than 70 percent occupied and do not produce enough revenue to cover the monthly debt service payments. The property was transferred to a special servicer and a receiver was put in place to manage the property. The looming foreclosure would have resulted in the TICs losing their entire investment of $12MM.
Three weeks before the scheduled foreclosure, the investors hired Breakwater Equity Partners to advise them on strategies to save their investment. “Bankruptcy is one of the most powerful tools that we have in our arsenal. When it’s set up and managed correctly, bankruptcy can give the owners an opportunity to restructure the property,” said Phil Jemmett, CEO of Breakwater Equity Partners. “We have extensive experience using bankruptcy to save TIC investments, and expect that the Lenox A & B investors will be able to reach a satisfactory resolution through bankruptcy.”
“Most of us are mom and pop investors, trying to secure retirement income,” said Kurt Magneson, a tenant-in-common owner. “When we were sold the property, many of us were told that we could be passive investors because this was as safe as a bond. That wasn’t true. Now we are faced with losing a substantial portion of our life savings. We are committed to doing whatever it takes to save our property.”
About Breakwater Equity Partners
Breakwater Equity Partners is a San Diego-based commercial real estate workout consultancy and investment firm. Through Breakwater’s extensive experience on over 200 engagements with loan values in excess of a $2.5B, the firm has devised a unique, multidisciplinary approach to uncovering and resolving distressed assets. Breakwater’s professional team combines legal, financial, economic, banking, tax, and regulatory expertise to devise customized strategies for each property regardless of market (primary to tertiary), asset class (office, retail, multi-family, industrial, flex, land) or loan type (portfolio or CMBS). For more information on Breakwater Equity Partners, please call 858-490-3630 or visit http://www.breakwaterequity.com.