Commercial Real Estate Troubled Asset Valuation Support in Philadelphia

Who Needs This Service

Why This Appraisal Is Different

Assignments may assist with loan workouts, distressed loan analysis, foreclosure decisions, REO planning, bankruptcy, receivership, note sales, loan modifications, property disposition, restructuring, investment acquisition, and litigation.

A troubled commercial asset should not necessarily be valued using the same assumptions applied when the property was fully stabilized. An office building that has lost major tenants, for example, may require consideration of lease-up time, tenant improvement costs, leasing commissions, downtime, capital expenditures, and market rent.

A partially completed development may require analysis of construction costs remaining, development risk, market demand, and the value of the property in its current condition.

Our analysis may consider multiple valuation scenarios where appropriate. These could include current as-is market value, prospective value after renovation, prospective stabilized value, land value, and value under alternative use scenarios.

Clearly distinguishing between these values can be especially important in distressed situations. A property might have strong long-term potential while having substantially lower current value due to vacancy, physical condition, or capital requirements.

Highest and best use analysis may also become important. Continuing the existing use may not always represent the most economically productive alternative. In some cases, redevelopment, conversion, renovation, or even demolition may require consideration.

Commercial Property Types

Philadelphia Market Context

Philadelphia contains a wide range of transitional and distressed commercial properties, from older office and mixed-use buildings to industrial facilities, retail properties, apartment assets, land, and redevelopment projects.

The appropriate strategy depends upon both the property's characteristics and current market demand.