The Situation
In 2008, a high net-worth, off-shore family (Family) with limited U.S. real estate investment experience, formed a joint venture with a Florida-based investment/development company (Developer) to anchor a fund (Fund) to purchase commercial properties. The Family contributed significant equity up-front for immediate investment along with a commitment for future equity to commingle with outside investors. The Developer provided a small equity stake and the real estate leasing and management expertise as well as overall asset and Fund management.

A portion of the Family's initial equity was immediately invested in three properties, all of which were purchased at the top of the market with considerable debt. In addition, the Developer aggressively pursued acquisition of several similar properties. With a deteriorating U.S. economy and underperforming assets, it was apparent that additional investment in the Fund was not prudent and that the Family needed a local (U.S.) representative to monitor the performance of the portfolio and to advise them on changing market conditions and guide them on strategic decisions regarding their real estate investments.

The Problem
With global, non-real estate business interests, the Family needed an experienced, knowledgeable real estate professional to serve as an advocate to protect their investments in the Fund and work directly with the Developer.

The Solution
The Family engaged PREF to serve as an advocate for their real estate portfolio to represent their interest on an ongoing basis. PREF analyzed the situation, developed a strategy and executed the approved plan.

• Performed a market and financial evaluation of the three properties and recommended a course of action for each asset.
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• Renegotiated the terms of the agreement with the Developer to account for changing market conditions and asset performance.
• Continues to advise the Family on strategic decisions.
• Represents the Family in negotiations with lenders, leases and budgets.
• Co-manages the asset with the Developer on an ongoing basis to ensure Family objectives are met.

The Result
PREF has worked closely with the Developer to create and implement strategies to maximize the financial performance of the properties in preparation for a timely sale. The Family is confident its portfolio is now managed effectively and can focus on its other interests.