The Great Multifamily Put Option

What is this? This is the “extend and pretend” that lenders, borrowers and investors do when they negotiate loan workouts that are based on where they believe the assets’ KPIs will be, Fed rates will be, employment will be and supply and demand will be.

Yes, we call this investing in CRE💡

At Kaliser Law, we have been representing over 60 client groups on workouts and loan modifications on their CRE for the last 12 months. With another $1T of MF set to mature this year, not including extension and modifications agreed to over the last 18 months, there is plenty of opportunity for owners to negotiate and some buyers to pick up assets at values that have been seen for 10-15 years, in many cases.

On the buy side, we have picked up clients that are actively buying assets from the largest lenders at or below original loan values. I know this because some of there are our client’s former properties. I have seen some go for 70% of original loan amount, with the same lender offering pretty favorable financing terms.

This, THE GREAT RESET presents huge opportunities, just like the 2010 housing crisis.

John Monteiro, BS Economics, MBA forwarded a good podcast describing the fragility of the CRE market while still showing optimism, especially for MF over the next 18 months as supply dwindles.

We are having some good success on deflated loans and loan mods with many clients. Reach out if you have questions.