August 4, 2023
With over $1.5 trillion in commercial real-estate debt due to mature by 2025, aggressive lenders and savvy investors will likely have opportunities to buy distressed debt at a substantial discount. But whether a fund seeks to buy distressed debt for the purpose of foreclosing on, and ultimately owning, the property, or simply seeking to collect default-rate interest and other penalties and fees from the borrower, there are several important legal factors—even beyond the economics of the deal—to consider.
In this short video, Schlam Stone & Dolan partner Joshua Wurtzel discusses the various factors that any fund considering a strategic acquisition of distressed debt should think about, and also provides advice about the types of protections in the existing loan documents that a potential lender needs to look for during its diligence.