Multi-Unit Apartment

Distressed Loans & REO Properties for Sale

…prices starting at $7,500 per Door and GRM from 2.0
 

Acquisition discounts vary widely from bank to bank, property to property, and from state to state. Even though past results are no guarantee of future opportunities in this dynamically changing market, here are some of the typical acquisition parameters and ratios that have been achieved in the recent past:

Note Price to Current Value: 75% to 40%

Acquisition Price to UPB: 90% to 30%

Note Price per Door: $7,500 to $30,000

Gross Rent Multipliers (GRM): 2.0 to 6.0

Below are some examples of recently closed transactions of distressed commercial Multi-Unit Apartment Loan purchases:

  • West Texas, 325 Units, Current Value = $5 Mil, Avg Rent= $430/mos
    Note Purchase Price = $2.47 Mil, Price per Unit = $7,600, GRM = 1.5
  • Central Arizona, 270 Units, Current Value = $8 Mil, Avg Rent= $470/mos
    Note Purchase Price = $3.3 Mil, Price per Unit = $12,300, GRM = 2.2
  • Central Indiana, 225 Units, Current Value = $5 Mil, Avg Rent= $400/mos
    Note Purchase Price = $2.48 Mil, Price per Unit = $11,000, GRM = 2.3

CRE Note Exchange is constantly uncovering new sellers of bank owned Multi-Units and non-performing Loans for our registered buyers. Typically, non-performing commercial apartment loans yield a better discounted buying opportunity compared to bank owned properties, for the following reasons:

  • By selling a Note, the Bank saves money by avoiding foreclosure and legal fee’s.
  • Banks needing to raise cash quickly can liquidate a non-performing commercial loan much faster than foreclosing and then market subject property for sale.
  • When selling a Note, the Bank avoids taking ownership of the subject property, thus eliminating costs associated with ownership.

There are two basic types of distressed commercial apartment loans. One is a non-performing loan in which the property owner has stopped making mortgage loan payments. The other type of distressed loan, is when the property owner is current on their payments, but the commercial loan term has expired or the bank is in need to liquidate the loan asset for other reasons. Typically, in either of the above scenarios, the Unpaid Principal Balance (UPB) on the current loan is usually more than the Current Market Value (CMV) of the subject property.

CRE Note Exchange does not list distressed assets currently available for sale on this website, due to privacy concerns of the note selling banks. We also do not email blast commercial tapes to nondescript investors. Using a secure protocol, we deliver current distressed loans for sale only to our member investors whose purchasing criteria matches the parameters of the distressed assets for sale.

See Acquisitions Trading Desk for more details.