Distressed Investing
Our Approach
Investing in distressed assets requires not only the same steps required in buying “healthy” assets, but also an extra layer of work to take into account the asset’s specific nature of distress. Working with members of our corporate, real estate, and energy teams, Balch’s Creditors Rights & Bankruptcy Practice frequently works with investors to acquire not only real estate, but also operating assets in distressed sales.
The years of experience our attorneys have in representing secured lenders in enforcement actions against collateral, as well as other creditors in bankruptcy, uniquely positions us to represent clients acquiring assets in distressed settings. This could involve bidding on assets in a 363 bankruptcy sale, or at an auction conducted by a court-appointed receiver. It could also involve buying foreclosed property from a lender. Often, it involves acquiring property from a distressed seller on the verge of bankruptcy, receivership, or foreclosure.
Our Clients
We work with traditional and non-traditional investors in their purchase of notes and foreclosed properties from institutional lenders. We also work with investors purchasing both real property and operating assets in 363 bankruptcy sales and receivership sales, as well as in purchasing these assets from sellers on the verge of bankruptcy or receivership.
Our Experience
Bankruptcy Sales: We represent investors across the country conducting due diligence and placing bids in 363 bankruptcy sales.
Receivership Sales: While most states have a process for placing assets in receivership and selling those assets, the process varies from state to state. Our experience in representing receivers gives us the expertise needed to navigate the process regardless of the state.
Note Sales: We represent traditional and non-traditional investors in their acquisition of loans from lenders.
Foreclosed Assets: Balch represents investors wishing to purchase assets both at a foreclosure sale as well as from lenders who previously foreclosed and now own the assets. Depending on the state, an investor’s strategy may be to acquire and exercise the right of redemption arising as a result of foreclosure.
Out-of-Court Acquisitions: Sellers faced with the possibility of foreclosure, bankruptcy, receivership, etc. can be a great source from which to buy assets at an attractive price. However, sellers in distress often give rise to risks not seen when buying from sellers in more conventional contexts. We represent buyers in these situations to ensure their investment is not jeopardized by a subsequent bankruptcy or lawsuit filed by a creditor of the seller, such as a fraudulent transfer or successor liability claim.
