NORTHBROOK, IL-Hilco Trading LLC, based here, has launched Hilco Real Estate Managed Asset Resolutions, a new company designed to handle distressed properties for lenders and special servicers. The company hired distress experts for the new division, including 25-year veteran Jerry Hudspeth as CEO.

The company will conduct property valuations and develop and execute strategic resolution plans for each asset in a distressed portfolio, with each property directed through a workout or resolution process that could include foreclosure, receivership or bankruptcy. Hudspeth tells GlobeSt.com that the division will seek to unburden lenders, especially those not equipped for building management or disposition, from problem properties. “There’s a significant need for third parties to handle these sites for banks,” he says. “

Hudspeth says the distress is going to increase in the next couple of years, as loans made right before the downturn start to mature, with owners not being able to refinance. “I think there were about 1,200 loans in special servicing across the country at the end of 2009, and then we saw about 5,000 in special servicing at the end of 2010. This will increase probably into 2014,” he says. Even so, the bid-ask spread will continue to be too far apart for many deals, though capital sources are seeking properties that will offer the best yields, he says.

Though he’s worked as a consultant the past couple of years, Hudspeth previously served as president and CEO of Portfolio Financial Servicing Co., which was acquired by Bank of America in 2000. He  is joined in the division by Ronald Lubin, Edmund Terry and Michael Tsandilas.