News
OPPORTUNITY FIELD GUIDE
December 10, 2009
| Yesterday at 2 Park Avenue, we joined Cornerstone Accounting Group, Herrick, Feinstein, and the Schonbraun McCann Group to hear legal, financial, and accounting experts offer their take on responding to market issues. Heck, Bisnow liked the panelists so much, we even sponsored it. |
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| Over 100 attendees, plus webinar watchers, learned via case study, the first on raising a new fund for purchasing discounted debt that has tax exempt, foreign fund, and wealthy taxpayer investors. (We're dubbing that the Bermuda Triangle.) We snapped True North Management Group’s Desmond McGowan, Herrick’s Dennis Russo, Western Asset Mortgage Capital’s Steven Sherwyn, Schonbraun McCann’s Harvey Berenson, and Cornerstone’s Stan Perla. Desmond says distressed debt opportunities mean cherry-picking for the simplest structure, noting we’ll see lots of action from FDIC assets. You’ll need to find investors with faith in you and who’ll see beyond the money, they say. |
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| Where’s smart money going in real estate? Ask EdgeRock Realty Advisors’ David Lazarus, Apollo Management’s Scott Weiner, L&L Holding’s Robert Lapidus, and FirstService Williams’ Bob Freedman. This hasn’t been a shallow recession, Bob says, but as we were wallowing in self-pity, numbers outperformed expectations—we’ve lost less jobs than past downturns. Most activity is in public market companies right now, and there will be no replacement for Wall Street until ’11, David adds. Smart money is sitting on the sidelines or buying back their debt at a tremendous discount, Scott says—but there are opportunities everywhere. |
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| Marathon Asset Management’s Jon Halpern, Kaufman New Ventures’ Frederic Leffel, GoldenTree Insite Partners’ Robert Rediker, Heller Wealth Advisors’ Jordan Heller, and CIBC’s Michael Higgins then spoke on white knights rescuing real estate. Frederic says there are deals coming in where a building/asset/debt is okay, but the owner is in distress, plus loan sales from deals purchased in ’06-’07. Michael adds that plenty of regional banks have been overexposed to commercial real estate and are forced to sell, so expect a lot of activity as some close or reduce exposure. |
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| The audience then participated in a second case study, looking at the technical perspective of white knights. Here, we have Herrick’s Jonathan Adelsberg and Gary Eisenberg, Cornerstone’s Leo Chan, The Kaufman Organization’s Michael Giglio, Cornerstone’s Harry Dublinsky, Herrick’s Carl Schwartz, and World-Wide Holdings’ David Lowenfeld. Panelists discussed a case where two equal owners in one building lost tenant Lehman Bros, which was taking up half of the building. They’re now in default, and a white knight comes in to help the building—however, one partner refuses to be pushed out. Sounds more like reality television. |
