"With approximately $1.3 trillion dollars of commercial real estate loans coming due in the next four years, primarily from banks and commercial mortgage-backed securities, the core of our unique strategy is to bring borrowers and lenders together early to help solve the challenges of distressed situations," says Joe Franzetti, Cohen Financial managing director of the Debt Advisory Group.
According to a release, to meet client demand Cohen Financial's plans to focus on:
- Debt modifications - lenders agree to reduced interest rates or slow down amortization rates to allow cash flow to be reinvested in the assets.
- Discounted Payoffs – when modifying an existing loan is not the highest value solution, the borrower will refinance the property and utilize the proceeds to buy back the loan for a percent of the original price.
- Senior and Subordinated A/B strategies – when the property needs time to be managed until markets recover, the loan will be bifurcated into senior and subordinate debt. Senior debt will be supported by the property's existing cash flow and subordinate debt will be held until the recovery.
"Also, as banks look to acquire a deeper understanding of their loans, Cohen Financial will provide turnkey solutions that include determining a loan's market value, evaluating risks and individual borrower plans, as well as creating a clear vision of how best to position their portfolio," Franzetti says.
Cohen Financial, which has more than 30 years of capital market experience, is currently located in eight US markets with its headquarters in Chicago.
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