When negotiating with lenders, and especially special servicers on CMBS debt, many borrowers of non-performing loans are in need of rescue capital as part of their debt restructuring. But many traditional funding sources have dried up in the aftermath of the financial meltdown and recession.
Ann Hambly, founder and CEO of 1st Service Solutions, has teamed up with Mike Meisenbach, a certified public accountant and founder of Asset Advisory Alliance, to form a new company that addresses borrowers’ needs.
1st Equi-Debt Solutions, headquartered in Dallas, will focus on offering competitively priced equity and debt to distressed commercial real estate owners as part of their debt restructuring.
The Dallas-based company seeks to raise between $100 million and $200 million this year to establish an equity fund that gives borrowers access to capital and provides an opportunity for investors to buy distressed properties from lenders. Investors in the fund are expected to include institutional and high-net-worth investors, as well as some Asian investors.
“Having a company specifically focused on providing competitively priced equity and debt for distressed commercial real estate owners should meet both the needs of the borrowers as well as the lenders. This will allow lenders and special servicers to more effectively resolve distressed loans,” says Hambly.
Launched in 2005, 1st Service Solutions was formed to assist borrowers with commercial real estate loan restructuring, loan assumptions, defeasance, discounted payoffs and equity and debt solutions. Since its inception, 1st Service Solutions has resolved more than $4 billion in loans.
“Given that many borrowers have had their capital bases wiped out, they are in need of alternative equity and debt,” explains Hambly. “1st Service Solutions has successfully connected some borrowers to this form of equity and debt already in the past, but given the sheer volume of deals in the 1st Service Solutions pipeline, it was very apparent that the need for rescue equity and debt will only grow.”
Meisenbach has more than 26 years of experience in commercial real estate. Most recently, he was the principal and president of Investment and Capital Markets Advisory Services for Lee & Associates, a commercial real estate firm with 41 offices and approximately 600 agents throughout the U.S. In this role, Meisenbach sourced equity and debt solutions for commercial property owners.
In 2007, Meisenbach founded Asset Advisory Alliance, which is a group of investment brokers in the Western U.S. who assist lenders, asset managers, owners and investors to resolve their asset challenges. “I am pleased to be able to bring my experience to 1st Equi-Debt Solutions and to be part of an organization that is a leader in the industry,” he says.
Meisenbach will serve as the CEO of 1st Equi-Debt Solutions and Hambly will be a vice president with the new company. Meisenbach has relocated from Newport Beach, Calif. to Dallas.