The Upside of Distress?
Real Estate BisNow reports: Investors have become giddy about taking advantage of distressed assets in the credit crunch, Real Capital Analytics research guru Dan Fasulo told us when we visited his Fifth Avenue office recently. Funds began asking RCA about these, so its analyst team started tracking and flagging properties globally last fall for a new product offering. It discovered that distress is not only on the property level, but on the ownership level, so it split the assets in two buckets: troubled, when the owner or building has defaulted, or is in danger; and potentially troubled, when the owner has immediate refi debt and may not meet obligations or a building may lose a major tenant.
He tells us that while there are $3.5 billion in distressed assets in NYC, there are only $300 M in the DC metro area. (You can thank tenant/owner U.S. government, Dan says.) They range from Record Realty's office portfolio from the Government Properties Trust takeover; former Boscov department stores; and many General Growth Properties assets that may become available. About 150 assets are tagged as potentially troubled, mostly in NoVa, where prices rose rapidly in '06 and '07, and have since fallen significantly. The D.C. metro will also see more apartment buildings tagged, Dan says.
View the full article on Real Estate BisNow: The Upside of Distress?
Posted by: Nina Turner