Possible mix-use deal - Posted by Curtis

Posted by ray@lcorn on September 28, 2004 at 10:39:59:


First, find out how solid your friend is in taking the space. Vacant restaurants are a dime a dozen and you don’t want to make the seller’s problem yours.

The bankruptcy complicates things. The sale will have to be approved by the trustee, and if there is real or perceived equity there it may be best to buy it at auction.

I would first read the bankruptcy file before doing anything. I’ll guarantee the stated value of the property on the bankruptcy schedules is less than the asking price. Find out the minimum amount of cash it will take to satisfy the trustee. Look at the overall debts in the case. Consider alternate strategies like buying creditor claims that can give you control of the property.

If sale is the only option, then normally I would start low, very low, say at the current debt amount, and only offer to pay some amount over the mortgage if it can be deferred until the project is stabilized and the property can be refinanced. But negotiating a deal like that in bankruptcy is tough because the other creditors will almost always vote for cash in the hand over a promise to pay.

That’s about all I can suggest with the info supplied.


Possible mix-use deal - Posted by Curtis

Posted by Curtis on September 27, 2004 at 12:22:12:

Hey folk,

Pre-foreclosure called today with a restaurant which is in pre-foreclosure. 3br apt above restaurant. Owner filed chpt 13 bkrptcy last month to stop the sale. Pricing and comps ??? I may be able to assign this to a friend who wants to open a restaurant.

Amt owed $225K
owner trying to get 400K for property.

Any ideas??

In NY Long Island.

Thanks for feedback.