Criterion Development president and principal Pretlow Riddick says the idea behind the new division came about when the owner of 10 under-performing multifamily assets in Boston, Washington DC, Dallas and Austin asked if the real estate development company could help increase the value of the distressed properties. "They'd approached us to do the services work, and that's what lit the fire under us to actively market this capacity," Riddick comments.

He tells GlobeSt.com that "distressed assets" can be defined as those not meeting original investor expectations due to defaults, debt obligations or valuation. For example, Criterion Real Estate Services is helping the 10-asset apartment portfolio owner in areas such as disputed land contracts, renovations and underwriting qualifications. Other services offered by the new division include market analysis, regulatory requirements, entitlement risk assessment, and site and design assessments.

As of now, Criterion is dedicating existing staff to the new practice. Riddick says as the division grows, more employees will be hired. He adds there is little doubt that growth will happen.

"These days there are huge stresses in the markets, when you take into account job losses and underperforming assets," Riddick comments. "People are having to re-analyze their assumptions about investments and what they own; and this is where we can come in to help."