NAS recently assisted Florida office property Investors avoid foreclosure while realizing a financial gain that was once considered by property investors to be improbable. The NAS management team, known for their ability to turn around financially distressed properties, acted in a key advisory role to create greater marketability for the recent sale of the Gibraltar Office Building, Palm Harbor, Florida. The recent sale of the property closed ahead of a maturing loan date.
Company executives advised a swift and aggressive plan of action to increase revenue while reducing operating expenses with cost effective maintenance and prudent capital expenditures. At the time of sale, the property’s occupancy was 100%, due in large part to a tenant renewal accounting for 36% of the total tenant space. NAS was able to add value for the Co-Owners with the renewal, contributing to an environment of competitive bidding among several potential buyers. In addition to a higher market value, NAS executives directed negotiations resulting in below market broker commissions, contributing to a positive return on investment for the property owners.
“We were successful in creating greater market value for an office property in financial distress and facing possible foreclosure,” commented Karen E. Kennedy, President and Founder of National Asset Services. “The resulting investment gain from the property’s sale in a competitive market created by our efforts produced the best possible outcome for our clients invested in Gibraltar. It is one more example of our proven ability to offer solutions to clients facing loan maturity.”
The Palm Harbor, Florida office property investors, assisted by NAS, are part of the commercial real estate industry’s giant wave of 10-year Commercial Mortgage Backed Security (CMBS) loans that have been maturing since 2014. Industry sources expect the total loan volume to peak during the remainder of 2016 and 2017.
Many tenant-in-common properties purchased by investors in the early-to-mid 2000’s, were done so with highly leveraged, interest-only, 10-year loans. Many commercial properties, across the country, offered as tenants-in-common real estate investments, before the recession started in 2008, resulted in a financially challenged situation. These challenges were due primarily to mismanagement or underperformance by the property’s original investment sponsor. The challenging economic conditions have left many TIC investors at risk of losing their investment with very few options and few resources to help them work towards a positive outcome. For more information, visit nasassets.com/loan-maturity-solutions.
A group of 20 TIC investors acquired the Florida office property in 2006. The NAS team was retained as an asset and property management consultant by the investors in Spring 2013 for the 23,684 square foot office property.
Constructed in 2001, the Gibraltar Office Building features a beautiful, 2-story blue-colored glass entrance and an 11,000 square foot covered parking garage. Situated on approximately 2.6 acres, the office property is located along Highway 19, the major north-south thoroughfare paralleling the Gulf Coast in Gulf Harbor, Florida, a part of the Tampa – St. Petersburg Metro Area.