Posted on Wed, May 02, 2012
Sad as it is, sometimes a troubled relationship just can’t be saved. This is true in both our personal lives and in the banking community. When a marriage ends there are tough choices to be made and years of good and bad memories impact those choices. Community and Regional banking is unique and yet similar to marriage in that it is often based on long-standing relationships which can involve years of transactions between institutions and borrowers. Most of those relationships will remain strong but when things start to deteriorate, as is the case with nearly 1 in every 8 loans in New Jersey, it is like the song says... “breaking up is hard to do!”
Just like in marriage, many banks are unable to face the fact that their lending relationship is over. Action must be taken when the borrower is not living up to the reps and warrants of the mortgage agreement. So, what to do? What to do? In a spousal relationship, a couple can choose to go through a long drawn out court process or they can use a mediator. The court process is similar to a bank taking a borrower through a protracted foreclosure process. According to an April, 2012 report by RealtyTrac (http://www.realtytrac.com/home/), the average foreclosure in New Jersey takes approximately 966 days. In mediation a couple can work toward a more amicable and quicker split. “I believe that Mediation offers a more effective means of resolving a couples’ conflict. On the loan advisory side Helios Capital offers a more practical means of resolving lender/borrower conflict through a loan sale rather than the present court system” says Joseph Villani, Director of Helios Capital Advisors. In mediation some agreements come easily and others are harder to reach. Mediators keep the couple focused on the issues at hand. Lenders need to divorce themselves from non-performing loans on their books and sometimes a non-biased third party opinion is needed to intervene and move the process forward. Helios keeps the focus on driving value through a defined loan sales process which helps Community and Regional banks break away from relationships that are unhealthy for their profit sheets.
As a relationship driven company Helios is able to quickly and efficiently match banks with investors interested in loan sales. The average portfolio sale is completed in less than 3 months. An individual loan sale can be executed in as little as 1 week. Villani says, “when a marriage is over it is not the time for retribution and revenge, but rather the occasion to seek a path to your new life while providing for and protecting your assets and your children. Similarly, when a lender/borrower relationship is over, it is not necessarily time for the lender to litigate, but rather the occasion to seek an alternative path to stabilizing their balance sheets and improving their capital position.” It is, simply put, time to move on.
Helios’s success in selling sub-performing and non-performing commercial mortgage loans in the tri-state area has not been accomplished through a shot gun sales approach, but rather through a well-defined sales and marketing process that delivers the highest value and best execution for its clients. “Helios offers a kinder, more effective method of breaking-up when banks want to divorce themselves from their distressed debt,” stated Steven Schultz, CEO.
Posted on Tue, Apr 24, 2012
Helios Capital Advisors has completed loan transactions totaling over $25 million in the NY/NJ market in the past 2 months. As a full service real estate advisory firm specializing in the sale of small balance commercial mortgage loans and REO assets we target portfolios and individual assets with unpaid principal balances. The successful outcome of these transactions is directly related to the relationships that Helios has established in the commercial real estate and banking communities.
In February, Helios sold and closed a non- performing loan portfolio for Investors Bank totaling approximately $23 million. It consisted of 26 individual loans secured by various assets in the NJ market. We widely marketed the pool to our long list of investors and used a controlled bid process. Helios closed the transaction within 90 days.
In March, Helios also closed 3 loan transactions in the Bedford-Stuyvesant section of Brooklyn, NY. In that deal Helios was approached by a long standing client with an interest in the properties. Since Helios had a strong relationship with the lender as well, a deal was reached within days.
This month, Helios arranged the sale of a nonperforming loan secured by a 10 unit, 10,028 square foot multi-family property in the Bronx, as well as the sale of NPL notes secured by a retail property and a 15,000 square foot multi-family property in that borough.
By maintaining profound relationships with both investors and lenders Helios is able to identify specific investment requirements such as geographical preferences, product type, credit risk and yield requirements and to expeditiously match the correct buyer to the correct seller. At Helios our relationships are our greatest asset.
Posted on Wed, Mar 28, 2012
Is it the doubt in seeing a loan sale process as successful that has held community and regional banks back or is it that their loans haven’t matured until recently? Community and regional banks interest in selling distressed assets has spiked over the last few months. Due to community banks having increased exposure to non-performing CRE/Residential loans, sales of these non-performing assets have helped banks reduce delinquent loans from their books. Steven Schultz, CEO, says “Helios is continuing to see a surge in banks selling their non-performing loans. Banks see our loan sale process as extremely effective in cleaning up their balance sheets. Banks can trust the Helios process.”
Distressed debt sales can generate recovery income which helps community banks shore up their balance sheets. Higher stock prices, improved earnings and a happy Board of Directors are an inherent benefit of a bank knowing the value of its assets. Helios offers a proven, successful controlled bid process to help execute the sale of a bank’s distressed debt. We maintain a strong personal relationship with both the banks we serve and the investors we deal with. We are therefore strategically placed to structure distressed debt sales which are executed swiftly and efficiently. From bids to post sale closings Helios will assist its clients every step of the way, leaving no doubt that they have made a wise decision.
Posted on Tue, Mar 20, 2012
Helios Capital is seeing a spike in non-performing loan sales. In the first quarter of 2012 there has been a flood of opportunity in the distressed asset market. According to a recent Ernst and Young report (Mar 12, 2012
Business Wire) “the sheer volume of US commercial real estate loans maturing in the next five years could put pressure on banks to step up their efforts to strategically sell some of the more than $100 billion in NPL’s currently on their books.”
[1] Seeing evidence of this in the last quarter Helios believes that it presents a unique opportunity for investors.
Steven Schultz, CEO of Helios, says “I’m extremely bullish on the NPL sales market for 2012-2013.” Regional and community banks are aware that they now need to reduce their non-performing loans from their books. Helios has been helping them do just that. We have recently closed on over $100,000,000 in loan portfolios and we expect the NPL market to stay active for at least the next 2-4 years. The market is being fueled by several factors including new financing opportunities and the fact that interest rates are at an all time low. As a relationship-driven company we are highly successful in helping sellers who are looking to dispose of assets by quickly identifying the correct buyer from our vast pool of investors. We thus provide the perfect opportunity and create a seamless, efficient process for all involved.
[1] Ernst and Young: Investors Eye Four More Years of Distressed Real Estate Debt Opportunities, Andrew Neilly
Posted on Fri, Dec 30, 2011
A borrower defaulting on a loan is not an uncommon tale. In fact, a bold 9.37% of CMBS loans are delinquent, reported in recent research conducted by Trepp, LLC, a leading provider of CMBS and commercial mortgage information. To some, 9% of anything may not seem significant; however in the CMBS market, that 9% accounts for thousands of loans and millions of dollars. Of those thousands, 8.75%, Trepp reported, are over 60 plus days late, in foreclosure, REO, or are non-performing. In other words, these assets are distressed.
According to a recent study conducted by CoStar, a leading provider of information, analytic and marketing services, it is projected that $850 billion of commercial mortgage securities are maturing this year. Of that $850 billion, 55% accounts for loans whose original maturity date was extended. This whopping number is a foundation for distress advisory in regards to restructuring and re-trading loans to investors.
Distressed assets are not attractive to lenders; they are a red flag to possibly denying future loans. To an investor, however, distressed assets flaunt their potential. Distressed assets, if advised and traded smartly, can be transformed from debt to profit, no matter the amount of time it lurked in default. Helios Capital Advisors is that stepping stone from delinquency to sufficiency.
Posted on Mon, Jul 11, 2011
Integration is about gaining, not compromising. In the business world of real estate, what is most to gain is the economic, social, and educational aspects of such a relationship. As Helios Capital, LLC continues to integrate with the renowned real estate firm, The Schultz Organization, the economic, social, and educational foundation of our firm is strengthened furthermore, day by day, deal by deal, and Helios Capital Advisors is then such born.
Helios Capital Advisors is the industry’s preeminent boutique advisory firm specializing in providing a full range of advisory services on behalf of private, institutional and corporate lenders and investors in the secondary market for the purpose of efficiently trading commercial mortgage loans, REO assets and investment properties throughout New York, New Jersey, Pennsylvania, and Connecticut.
“Helios’ Chalk Talk Blog” will keep our clients, colleagues, and friends up to date with the most recent activity happening in our world of advisory services. Our blogging will occur weekly and consistently, and will indulge in an array of subjects, from new exclusive assignments and recently closed deals, to market news and community involvement.
To grasp a greater sense of who we are, please visit the “About Us” page or browse through our articles and publications within the “News” page.
With the integration of The Schultz Organization and Helios Capital LLC, Helios Capital Advisors has built a platform of becoming the most reliable and trusted relationship-driven company in the real estate advisory services industry in order to provide extraordinary service to our clients.
Helios Capital Advisors has compromised nothing, and has gained everything - an undeniable foundation of integrity, passion and experience. Let’s continue to move forward together.
Written by:
Steven M. Schultz, Chief Executive Officer
sschultz@heliosca.com