I had a new one yesterday. It is the distressed real estate trifecta (did I spell that right?)
My New Properties - I was approached to take on management of 60 units of townhomes. They are all 2 unit structures. All are on separate parcels. All are on residential mortgages. There are at least 5 banks. Each bank has sold some paper to another and is only servicing the loans, so there are probably 15 underlying lenders here. Each strucutre is about 30k under water. Within the "development" there are 5 owners. My "client", his father, his friend, some guy that nobody can find and the last "owner" is some REO Department.
My New Employees - There is also an unlicensed leasing agent who was on payroll as an employee of the owner and her husband the maintenance guy, also as an employee of the owner. Yesterday was their last day on his payroll. We are looking into having them work for me, but only on this property. Wife is tough due to no license. There is a little that she can do in our office. The office is about 20 minutes from the complex. We offer wife a job and she asks to be paid from the time she leaves her house until the time she gets home. She is not going to last long.
My New Tenants - One called yesterday while I was in the office with the owner. She wanted her gutters cleaned and there was a little squeek in the ceiling fan. No fixy, No payee says she. Now she is in a $550/mo unit and only pays $380. Nuff said on tenants.
The Overall Situation - In addition to just managing the properties, the owner wants to list them for short sale. Not bad. $80,000 each x 26 (the units belongto dad). Sounds like a good month. Here is the catch. CH 7 is coming. There will be a trustee involved for a little while until she'he determines that there is no equity. She/he might sieze all of my cash, so that could be bad. Then there will be an abandonment and it will be just me, myself and I until either short sale completion or foreclosure completion. Good news is that I sell REO for some of the banks involved.
I just realized that this blog could be about three times the length if I were to add in all of the details.
It is going to be a mess. There are so many ways for it to go wrong I could not possibly list all of them. This is going to be such an adventure that I can't possibly turn it down.
Do you have questions about distressed assets, receivership or bankruptcy sales, auctions? Email me at rfk@gryphonusa.com and I'll try to answer it in an upcoming post.
Richard F. Kruse is the President of Columbus, Ohio based Gryphon USA, Ltd. (www.gryphonusa.com). The Gryphon Organization includes Gryphon Asset Management providing receivership and consulting services in the distressed marketplace, United Country Gryphon Realty & Auction Group (www.ucohiorealty.com & www.ucohioauctions.com) providing real estate brokerage and auction services throughout Ohio and OnlineAuctionUSA.com (www.onlineauctionusa.com) providing commercial asset liquidations from the Midwest to East Coast.
United Country Gryphon Realty & Auction Career Opportunities Available. Call 614-885-0020 x 17
"Rich aka Delicate R"
Yup. It's gonna' be a mess and huge headache. That guy up there is a good picture of how you will look shortly.
I have to admire your stamina on this. I would say something about tenants but you and both know if I do my comment will turn into a blog. I better pass on that.
However, I will say squeaky fan..."Say Hi to this 3-Day Notice Babe"...
I gotta stop there. I feel some serious mouthy mouth coming on. :0)
TLW "The Lovely Wife"...I Got To Hand It To You Man...ROAR!
OUCH!!! Sounds like REAL FUN!!! We just fired a customer because we could not deal with the Idiosyncrasies. Aren't tenants so much fun?
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Great story. My tenant likes to play that game too! I always go over to the house to collect my rent and remind them, they can move anytime if they wish!
Seems they just like to shoot the Breeze....