Perhaps the greatest opportunity in real estate investing over the last decade has been high yield debt. Pair the term “commercial real estate” with the terms, “hard money”, “bridge loan”, “core plus”, “value-add”, “opportunity investing” or “high yield” in an internet search and a dizzying number of results appear reflecting the proliferation of opportunities available to return-hungry investors and savvy real estate entrepreneurs. In the middle are the people who find the deals, crunch (and re-crunch) the numbers and chase the returns.
Essex Financial Services collaborates with the people who make the deals to determine the level of service that complements their existing strengths in managing risk and meets their objective of thorough ongoing project surveillance. While we expertly handle the loan administration aspects of loan servicing, where we really add value for high yield lenders is in how we monitor and strictly enforce borrower loan covenants, analyze operating statements and rent rolls, continuously assess collateral condition, administer escrows, reserves and lockbox activities, provide support in earn-out determinations and closely follow the progress of lease-ups, rehabs and PIPs.
High yield loans require a higher level of attention. We communicate regularly with the borrower and execute the lender’s unique portfolio- and loan-level risk management plans daily.