Case Study

Financial Advisory

International Real Estate Investment Company

THE FIRE

An established real estate investment company experienced declining net operating income (NOI), reduced cash flow and increased debt during a real estate downturn.

The company could not service debt and began to experience operational liquidity constraints.

Older properties required significant capital to renovate in order to be competitive with newer properties.

Management was fragmented due to dual headquarters operating from two separate countries (U.S. & Canada).

THE RESCUE

Performed a detailed analysis and valuation of the company and all properties.

Performed and evaluated multiple financial scenarios.

Developed a comprehensive business plan with recommendations to sell 4 specific properties, pay down at least half of the debt and refinance at lower interest rates, and reinvest capital into new construction in more lucrative and solid real estate markets.

THE RESULT

Each property was sold for approximately $10 million each, resulting in a $40 million cash infusion.

Paid down $20 million in debt and refinanced the remaining debt with a 250 basis point savings, preserving millions in debt interest over a 20-year period.

Invested $12 million into new condominium construction that was presold before ground-breaking for a 300% return of projected cost.

Improved overall NOI and cash flows.

Increased efficiency and moral by consolidating and steam-lining responsibilities between offices.