How to Tap Unlimited Funding for Your Real Estate Deals

Overlooking issues during the due diligence process can cost you time, negotiation leverage and it opens the door to expensive surprises after closing. The numerous areas of inquiry - combined with limited timeframes and pressure to cut corners - means that mistakes are easy to make. Is your due diligence comprehensive? This guide will explore the top due diligence oversights so you can effectively avoid them in your practice. Prevent bad deals and ensure a smooth transaction - order today!

Understand the key steps in the bankruptcy process and how they affect the various parties related to commercial real estate. Bankruptcy cases involving commercial real estate present a multitude of problems. Depending on the party and its relation to the real estate, significant differences in concerns, legal issues and strategies come into play. Knowing the bankruptcy process, certain key provisions of the Bankruptcy Code applicable to commercial real estate, and what to expect in a bankruptcy case involving such real estate are vital in evaluating the best path. Owners of commercial real estate, tenants of commercial real estate, and mortgagees on such properties must each understand their respective positions, claims, and rights in a bankruptcy case. Knowledge of these issues in advance of a bankruptcy filing can greatly enhance preparation and expectations for counsel and their clients if and when a bankruptcy is filed.

This highly informative material is designed to enhance your knowledge and understanding of how various types of escalations, such as operating expenses, common area maintenance (CAM) and real estate taxes, among others, are addressed in today's commercial lease environment. The speaker will explore these obligations from the perspective of both the landlord and the tenant, as well as discuss the importance of thoroughly reviewing commercial lease provisions and addressing ambiguous language.

Mezzanine financing allows borrowers to obtain financing in addition to a mortgage loan, but mezzanine loans add complexity, with additional documents, legal opinions, and third-party reports. Mezzanine lenders require separate consent rights for various actions by the borrower, and restructuring a nonperforming loan is especially problematic given the diverging interests of the mezzanine and mortgage lenders. Since the mezzanine lender's security interest is in the borrowing entity rather than the property, it must conduct entity-level diligence, including analyzing potential claims and agreements entered into by the property owner. Existing contracts and licenses might contain restrictions on transfer--the pledge securing the mezzanine loan or any foreclosure of the pledge could violate such limits. The mezzanine loan agreement should track the mortgage loan agreement, with mortgage loan representations recast to refer to the mezzanine borrower and the mortgage borrower. The mezzanine borrower and the mortgage borrower should be required to comply with entity-level covenants and property-related covenants. The mezzanine borrower's obligations are secured by a UCC pledge of equity interests in the property owner. The pledge can be perfected under Article 8 of the UCC. The mezzanine borrower's ownership interest in the mortgage borrower must be certificated so the mezzanine lender can take physical possession of the membership certificates. The operating agreement should also include Article 8 opting-in language. Listen as our authoritative panel discusses the nuances of mezzanine financing.