Miami FL: Retail Center Default Loan Negotiation
PROPERTY SITUATION
A CMBS Loan originated in 2014 and collateralized by a Walmart Anchored Shopping Center was transferred to CMBS Special Servicing in January 2017 when the Master Servicer alleged that a portion of the rents was not being deposited to the lockbox. The loan was performing in every other aspect. As the dispute advanced, the Special Servicer issued a Notice of Default due to borrower’s failure to make the June 2017 mortgage payment, and subsequently commenced a foreclosure action in November 2017 as the alleged defaults were not cured. Borrower and Servicer entered protracted litigation related to the default and subsequent foreclosure action resulting in a large Default Interest balance. The Borrower decided the best action was to sell the asset and have the new buyer assume the loan. When the Borrower entered into a Purchase and Sale Agreement of the property and assumption of the debt with a Buyer their initial attempt to negotiate a reinstatement and assumption with the Special Servicer was unsuccessful.
BCA RESOLUTION
After the parties’ failed attempt to reinstate the Loan and assumption of the debt, Borrower and Buyer retained Brighton Capital Advisors (BCA) to negotiate on their behalf with the Special Servicer. Immediately, BCA contacted the Special Servicer and was able to slow the foreclosure action as we proposed a solution to replace the existing ownership with a strong replacement Borrower. BCA reviewed the loan documents and prior communications with the servicer and established a viable line of communication with the Special Servicer, Buyer, and Borrower.
Then, BCA leveraged its legal and servicing expertise to successfully negotiate on behalf of the Borrower and Buyer the amounts due to (i) reinstate the Borrower’s defaulted Loan with a 70% reduction in fees and costs, (ii) satisfy litigation claims, and (iii) facilitate a simultaneous assumption of the debt. Because of Brighton Capital Advisors’s experience and relationships, we were able to close the reinstatement and assumption in a timely manner allowing the buyer to close within his 1031 exchange timeframe.
LOCATION:
Miami, FLPROPERTY:
Walmart-Anchored RetailProperty Details
PROPERTY TYPE | Walmart Anchored Retail |
CITY | Miami |
STATE | FL |
BUILT | 2014 |
SQUARE FOOTAGE | 246,833 |
LOAN AMOUNT | $49.0M |
MASTER SERVICER | Keybank |
SPECIAL SERVICER | Mount Street US LLP |
DATE COMPLETED | Feb 2022 |