Property: Office Buildings in Michigan and Illinois
Loan Balance: $95 million
Problem: The loan on this property was originated in 2006. The current value of the properties was approximately half the loan amount. It was unlikely that the value would recover by maturity. Following a thorough analysis of the borrower’s situation, the parties decided that the best solution for the Trust was a DPO.
Solution: The DPO was negotiated for $35 million, which was below the appraisal value of the properties. The result was a better outcome for the Trust than foreclosure would have been. Additionally, the borrower was able to achieve 100 percent financing on the DPO.