Distressed Real Estate

The current state of the real estate market has created both challenges and opportunities. From the first hint of trouble for a lender with real estate assets on a watch list, or for an owner who has real estate floundering through workout, bankruptcy or litigation, McGuireWoods’ Distressed Real Estate team provides a highly skilled, integrated team of transactional, bankruptcy and litigation lawyers to take problem real estate assets and turn them into income producing successes for our clients.

Our attorneys provide nationwide counsel and interdisciplinary solutions to a broad range of clients including lenders, private equity investors, specialty finance firms, borrowers, debtors, developers, municipalities, investment banks, landlords and tenants.

Our capabilities include:

Pre-workout Services

For our lender clients we perform pre-workout analyses for troubled loans, loan portfolios and lender liability avoidance by utilizing the experience of our seasoned real estate practitioners. Coupled with our environmental, corporate and tax lawyers as needed, our team regularly assists clients in performing rapid due diligence reviews for key components. For our borrower or debtor clients sensing trouble for their assets, we perform due diligence and asset clean up, develop alternative strategies to address lender concerns, and if necessary, provide pre-bankruptcy planning.

Workout

In troubled real estate workouts we help our clients identify and implement a wide array of solutions for their specific needs. We assist both our lender and borrower clients with all aspects of loan workouts, including forbearances, loan modifications, project entitlement and development issues, and negotiations to bring the lender, borrower and other interested parties together to successfully restructure and document their deal. We also provide counsel in all types of real estate matters in bankruptcy, including single asset real estate case issues, adequate protection of the lender’s interest in collateral, stays against lien enforcement, valuation of collateral, assumption or rejection of leases, and restructuring loan terms through a confirmed plan of reorganization.

Enforcement Actions

When enforcement actions are necessary, our collaborative team of skilled bankruptcy, litigation and real estate lawyers work closely and efficiently to pinpoint the most effective remedies for our lender. For example, our team regularly handles a variety of matters including judicial and non-judicial foreclosure proceedings, deeds-in-lieu, receivership actions, deficiency collections and related litigation. We defend lenders against lender liability claims, countersuits, and other claims arising from distressed real estate loans, in both state and federal courts across the numerous jurisdictions nationwide.

Investment Opportunity

Our clients regularly use our Distressed Real Estate team’s services for their investment in troubled real estate deals. The investment may come as acquisition (or disposition) of all asset types, including commercial, industrial, retail, office, mixed-use, multi-family, single family, warehouse, condominium, residential, or hotel and resort. The investment may also occur as a mezzanine loan, a joint venture formation, or a cash infusion with a preferred return. Alternatively, clients utilize our services to buy or sell notes or other debt instruments, effectuate bulk sales and auctions, and to consolidate rights and liens prior to remedy execution. We also draw upon the skills of our corporate and tax lawyers to structure investments transactions most favorably for our clients.

REO or Investor Assets

In the event an asset is held, post foreclosure or post deed-in-lieu, whether by a lender client in REO or an investor in a portfolio, our Distressed Real Estate team uses its depth of experience to resolve any outstanding issues relating to entitlements, community associations, zoning, permitting, municipal relationships, leasing, and environmental issues. Whether a client plans to hold the asset for a period of time while waiting for a stronger market, or intends to instantly reposition the asset and sell it into the current market place, we are experienced in the sale and acquisition of real property assets, including marketing and brokerage issues, for lenders and investors alike.

Specialty Services; Leases; Municipalities; CMBS

Our Distressed Real Estate team regularly serves as counsel to landlords and tenants confronting potential or actual bankruptcy from one or both parties to a lease. We also frequently provide advice to our municipal law clients regarding their bonds and permits for distressed real estate situations and their obligations regarding the development of distressed real estate sites.

Our clients routinely call upon our skills and capabilities to help them make essential business decisions when faced with a distressed real estate situation. We stand ready to assist them in their endeavors.

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