Value Recovery and Receiverships
Gerald Eve appreciate that sometimes property investments will not perform and as a result the repayment of the loans secured against them may be called into doubt. Where such concerns arise our valuation team can provide lenders with an initial assessment. As a result of such advice, or with growing tensions between borrowers and lenders, involving value recovery professionals may be the best course of action to ensure that the loan can be repaid.
Our value recovery expertise will provide an independent view and help a lender maximise its security.
We have surveyors experienced in dealing with non-performing loans and who are registered property receivers who accept appointments as LPA (fixed charge) receivers. Making such an appointment will help maximise the recovery of the secured loan. A particular advantage of a receivership appointment is the fact that the receiver isn’t liable for non-domestic rates which may immediately increase the monies that are available to be passed to the lender.
We understand the potential impact on an investment of an LPA appointment being made. We will work closely with tenants to reassure them and we recognise that some people consider a receivership sale will require a discounted price and we will work to ensure this isn’t the outcome.
Monitoring (shadow receivership)
A lender may wish to monitor the performance of the asset and the decisions being taken by the borrower without a formal LPA appointment. We can provide that expertise and scrutinise and monitor the proposals made by the borrower.
Our experience is that there can be definite advantages in keeping the property management function in place, albeit under close supervision. Where a change is necessary, we have strong relations with several experienced property management providers who we can introduce.
Developing a strategy
In any recovery situation, we will look to develop the best strategy to maximise the lender’s loan recovery within the timescale available. Our recovery team can draw upon the full cross spectrum of expertise to be found at Gerald Eve not least from our market leading national investment team.
Delivering the strategy
Over the agreed timetable we will deliver the appropriate strategy to maximise recovery. This may simply be to prepare the investment for sale and bring it to the market or to first deliver agreed asset management initiatives.
Realising the loan
As receivers we are likely to have to sell the investment to recover the monies due and will appoint the appropriate sales team best placed to deliver a successful sale. With a portfolio it may be necessary to assess whether to sell the portfolio as a whole, or in parts, or as individual assets with different sales options to be considered.
Throughout the process we will work closely with the instructing lender, reporting as the lender requires. In particular we will ensure that there is full accountability for all monies received.