Real Estate Capital Markets
McKenna Long & Aldridge (MLA) has more than 30 years of experience representing lenders. For clients such as Lehman Brothers, CIBC, KeyBank National Association, and PNC Bank, we have closed loans secured by retail, multi-family, office, hotel, industrial, mixed use, and other projects in more than 40 states. These loans include typical fixed rate term loans and floating rate interim loans, as well as mezzanine loans and loans with A/B note structures and other complex capital structures.
Unlike the model used by many of our competitors, we staff each loan with experienced attorneys who exercise practical, common sense judgment at each stage of the closing process. We know what our clients, the rating agencies, and the B-piece buyers expect, and we do not need to reinvent the wheel to close a loan.
We have experience with loans involving:
- Ground leases
- Tenants in common
- Master leases
- Hotel franchisor comfort letters
- Intercreditor agreements
- Subordination agreements
- Letters of credit
- Rate cap agreements
- Lockbox agreements
- Bankruptcy remote structuring
- Non-consolidation opinions
We also represent several loan servicers, so we are familiar with the REMIC issues and pooling and servicing agreement requirements arising when a borrower seeks servicer approval for loan modifications. We assist our lender clients and their borrowers in planning and properly documenting for known and foreseeable contingencies prior to closing, including partial defeasance, property substitution, transfers of ownership, changes in entity structure, conversions to other forms of ownership, and release or development of outparcels.
MLA lawyers have been active in structuring and closing mezzanine loans, preferred equity investments and other high-yield structured financings to fill gaps in the capital structure. These transactions have included mezzanine tranches or separate mezzanine facilities for single projects as well as large multi-state portfolios, "B" Notes or similar junior participations in securitized loans and other senior-subordinate debt transactions, as well as preferred equity investments. In many cases, such financings have been closed in tandem with first mortgage positions or other investments in the capital structure. Our lawyers are very familiar with the issues presented to mezzanine lenders, rating agencies and senior lenders in these financings and have the experience to achieve creative solutions to what are typically complicated negotiations.
In addition to our capabilities in structuring and closing mezzanine loans, our lawyers have substantial experience in resolving defaulted mezzanine loans, both through negotiated restructurings and through adversarial remedy enforcement. In particular, we have extensive familiarity with the issues related to foreclosure of pledged equity interests. Our deep experience in defaulted mezzanine loan resolutions gives us the unique practical skills to structure, document and negotiate new mezzanine financings in a manner best calculated to effectively manage risk in today’s challenging lending environment.
As the real estate capital markets have evolved and matured, we have assisted master and special loan servicers with their growing needs. Representing some of the largest loan servicers in the country, we have developed particular skill in:
- Assumptions of securitized commercial mortgage loans in connection with transfers of real property collateral or equity interests in borrowers;
- Substitutions of collateral;
- Placement of post-securitization mezzanine financing; and
- Defeasance transactions.
MLA attorneys are also adept at handling the unique issues special servicers must address in connection with the resolution or disposition of specially serviced CMBS loans.
Our ability to represent loan servicers is bolstered by our non-attorney Managing Director Brian Olasov, who frequently provides expert witness testimony and non-testifying consulting services in disputes involving securitized loan administration and valuation, including analysis of pooling and servicing agreements and compliance by master and special servicers.
Assumptions and Transfers of Interests
Since the inception of the CMBS market we have represented master servicers in numerous loan assumption and transfer of ownership interest transactions involving loans of all sizes secured by multi-family, office, hotel and retail properties. Many of these matters have been the most complex transactions of their type.
We are experienced in representing servicers, defeasance consultants, borrowers, and successor borrowers in connection with the defeasance of securitized commercial mortgage loans. Our defeasance work includes handling numerous “New York Style” defeasance transactions relating to real estate projects in states that impose significant mortgage recordation taxes, and structuring innovative defeasances of loans secured by multiple, cross-collateralized properties to minimize transactional costs and documentation.
- April 6, 2011
- Creating Value Out of Air: Three-dimensional airspace subdivisions can add value to real estate developments.As real estate developers seek to maximize value by creating or redeveloping urban properties into high-density, mixed-use developments, concerns regarding autonomy of operations for each use, conflicts among the different uses, and financial constraints can arise. Three-dimensional subdivisions—airspace lots or parcels created vertically and horizontally within a building to establish separate legally transferrable lots—is a way of addressing all of these concerns.
- October 20, 2010
- Dissolving Community Redevelopment
- Receivership: Distressed Real Estate
- Receivers Maximize Value of Distressed Assets, While Saving Lenders Money
- Real estate powerhouse emerges
- Tarp Discounts Still Playing a Role in Bank Acquisitions
- CRE Sector Balances on Uneven Recovery