Receivership

WHY A PRE-FORECLOSURE ANALYSIS?

Real estate assets abandoned by developers are often found in a state of disrepair. The time lapse from the developer failing to maintain the property and the lender foreclosing results in further deterioration of the site causing damage to improvements, environmental contamination and accruing fines. Often the lender must cause repairs and compliance to take place after the foreclosure process has been completed. In some cases the lender must pay fines associated with the developer’s failure to comply with environmental and code ordinances. Unfortunately these issues are often discovered late in the process and the lender is forced to react to pressure from enforcement agencies.

SOLUTION

Conducting a pre-foreclosure analysis will enable the lender to make informed decisions on how to proceed with foreclosure and respond to remediation needs by taking the surprise out of distressed asset ownership. A pre-foreclosure analysis will provide a detailed scope of issues and related costs. An action plan of remediation can be developed so that liabilities can be reduced and the lender can maintain focus on the value.

EXPERIENCE

Cold River Partners provide pre-foreclosure analysis to lenders as well as the expertise to repair the property. Cold River Partners maintain proper certifications and relationships through various aspects of site development resulting in a thorough analysis of each property.

PRE-FORCLOSURE ANALYSIS WHAT IS COVERED IN A PRE-FORECLOSURE ANALYSIS?

• A summary of site conditions detailing the status of development activities,  liabilities related to environmental deficiencies and safety concerns.
• Corrective action recommendations to achieve compliance and reduce liabilities.
• A compliance budget to implement the recommendations.
• Construction analysis and cost to complete.
• Property management and development completion.
• A photo log depicting current site conditions. 

WHY A RECEIVER?

Some projects are headed for foreclosure but have problems that make the lender hesitant to foreclose. In these cases, a court appointed receiver can give the lender a means to control the site and to have the issue cured or minimized without the lender entering the chain of title. Many jurisdictions are holding lenders responsible for things for which they are normally not liable. This creates a stalled situation in which the property deteriorates because the current owner cannot fund repairs and the lender is hesitant to take responsibility fearing he could end up with liability but no control.

SOLUTION

Having a receiver in place allows the lender to manage the expense, control the repair and return the project to compliance and stability. The lender also gains control of rents and leases, project income, and sales and marketing. The project receivership can then be terminated at foreclosure.

EXPERIENCE

Cold River Partners provide receivership services to lenders as well as the expertise to repair the property defect as well as manage the project cash flows, development completion, compliance and the full range of asset management required.