News Releases
June 6, 2017
Polsinelli|TrBK Distress Indices Special Report: Outcomes in Single Asset Real Estate Chapter 11 Cases

Report shows implications and opportunities for market participants


Polsinelli announced today the release of a special Polsinelli | TRBK Distress Indices report, titled “Outcomes in Single Asset Real Estate Chapter 11 Cases.”

The report concludes a one-of-a-kind research project tracking single asset real estate (SARE) chapter 11 bankruptcy cases across the nation which real estate is owned by an entity with assets above $1 million. The report analyzes the types of real estate assets that are in distress, the timing for those assets to go through the bankruptcy process, and the types and likelihood of outcomes for those assets.

“This report provides exclusive analysis of trends and outcomes in the distressed real estate market,” said Jerry Switzer Jr., a shareholder in Polsinelli’s Chicago office and co-author of the report. “What we were able to do is examine a wide range of SARE cases across the country and analyze the distress that remains in the real estate market since the great recession.”

“The report provides participants in the distressed real estate market, including developers/owners, investors and commercial lenders, vital information to assess and seize on distressed real estate opportunities,” said Jason Nagi, a shareholder in Polsinelli’s New York office and a co-author of the report. “For example, the highest percentage of SARE filings was in multi-family – a fairly healthy sector – and the vast majority of case outcomes resulted in dismissal. Nonetheless, a majority of distressed real estate at issue ended up being sold to a third-party, which has implications and presents opportunities for all market participants.”

“It would allow for a savvy, value-add investor to step in and turn-around the property after a bankruptcy exit, and for a lender willing to take some risk in exchange for some tight covenants,” said James Billingsley, a shareholder in Polsinelli’s Dallas office and a co-author of the report.

Polsinelli Shareholders Jerry Switzer, Jason Nagi, and James Billingsley authored the report and are members of Polsinelli’s Loan Enforcement and Creditors’ Rights, and Bankruptcy practices.

A full copy of the report can be found at https://www.distressindex.com/special/reo-outcomes-2017.

For more information, contact Carrie Trent at ctrent@polsinelli.com.