Hilco Real Estate Managed Asset Resolution Begins

Hilco Real Estate has launched a new operating unit to service deeply distressed real estate loans and REO assets.

The formation of the Hilco Real Estate Managed Asset Resolution will provide specialized, turnkey loan servicing to lenders and other real estate investing entities on their top distressed loans and REO assets. HREMAR will service distressed assets in every category from single parcels of raw land to the largest commercial and residential projects.

“There is a large void in the real estate asset management market that Hilco Real Estate Managed Asset Resolution will fill,” said Jerry Hudspeth, a servicing industry expert with 25 years of experience, who will be the CEO of HREMAR.

“Deeply distressed assets need specialized attention and unique skills to maximize value. Traditional servicers and lender workout groups cannot afford, or are often simply unable to properly service these assets. Hilco can because our business model is built on a core understanding of how to monetize distressed assets.”

Besides Hudspeth, the leadership team of the new operation will consist of Ronald Lubin, Edmund Terry and Michael Tsandilas.

“We’ve assembled a remarkable team of real estate professionals who probably know more about managing deeply distressed assets and maximizing recovery value than anyone,” said Neil Aaronson, CEO of Hilco Real Estate. “Jerry Hudspeth and his colleagues will have the full resources of Hilco Real Estate and the broader Hilco organization behind them to bring clients an elevated level of serving on their troubled assets.”

Through a platform of specialized servicers and experts, HREMAR will conduct property valuation and develop and execute strategic resolution plans for each asset in a distressed portfolio. The group will manage all financial, legal and other compliance processes and provide all necessary loan and property management services.

With HREMAR, every property has to go through a workout or resolution process, which could include foreclosure, receivership, or bankruptcy. If a resolution requires a disposition process, HREMAR will provide traditional brokerage and auction services.

“Our approach to lender workout groups and loan servicers involves a cooperative effort to identify the most troubled assets in a portfolio and parse them,” Lubin said. “Our group will then devise and execute appropriate strategies on an asset-by-asset basis, leading to the best end result possible.”

Terry said the HREMAR unit should benefit lenders and loan servicers because it will handle assets that these companies may not be able to deal with.

“This model ensures that lender workout groups and servicers can focus on those assets in a portfolio that best fit their core strengths,” Terry said. “It will enable them to transfer to Hilco the most distressed assets, for which they have neither the expertise nor willingness to commit resources. We believe that bifurcating a portfolio using this approach will be most efficient and a win-win for everyone.”

The HREMAR offices will be located in Chicago, Boston and Atlanta.