ATLANTA, GA--(Marketwire - November 13, 2008) - The credit crisis that is dramatically
affecting the commercial real estate industry is the impetus for a new
practice group at
Morris, Manning &
Martin, LLP. The Atlanta-based law firm is launching a new Commercial
Real Estate Debt Management Practice, offering legal support and practical
business advice to real estate owners.
"Refinancing simply may not be available to replace mortgage loans as they
mature," says MMM Partner
Nick
Sears, who heads the new group. "Moreover, if the economy continues to
degenerate, borrowers may not be able to derive sufficient cash flow from
their properties to make regular monthly debt service payments," he adds.
"Our team is particularly well-situated to assist commercial real estate
developers and owners with managing their relationship with lenders, as
well as the lenders' loan servicers, in restructuring mortgage and
mezzanine loans, identifying tax issues and resolving joint venture
partnership disputes," Mr. Sears says. "For example, we can advise
borrowers on how to operate their properties to avoid the 'recourse'
pitfalls in conduit loan documentation which could result in personal
liability of the 'carveout' guarantors," he adds.
Over the last 10 to 15 years, Mr. Sears explains, in many commercial real
estate loans the lender agrees to limit its collection efforts to
foreclosing on the real estate collateral except for certain "carve out"
exceptions; when these exceptions occur, the lender may then pursue
collection of the debt from any assets of the borrower and individual
guarantors. Examples of "carve out" exceptions to the "nonrecourse" nature
of loans are:
-- Actions of the borrower which result in a decline in the value of the
collateral
-- Sale of the collateral without the lender's permission or the
borrower's voluntary bankruptcy.
"The firm can also help members of the real estate industry look ahead and
take advantage of new opportunities afforded by the economic crisis," he
adds.
The firm's interdisciplinary team includes lawyers skilled in banking, real
estate, litigation, bankruptcy and tax issues. Mr. Sears has considerable
experience with real estate development and finance law. Others in the new
practice include
Tom
Gryboski, a Partner in the firm's Real Estate Group, and
Simon
Malko, a Partner in the Litigation Group.
About Morris, Manning & Martin, LLP
Morris, Manning & Martin, LLP, (
www.mmmlaw.com) enjoys national prominence
for its corporate finance, securities, mergers and acquisitions,
litigation, technology, intellectual property, real estate and real estate
capital markets, environmental, insurance and healthcare practices. The
firm has offices in Atlanta, Raleigh-Durham, Savannah and Washington, D.C.
Contact Information: Media Contact:
Terri Thornton
Thornton Communications
(404) 932-4347