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Beth Mitchell quoted in “Commercial Owners Can’t Tame Debt Nightmare”

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Banker & Tradesman
04.27.2009

Beth Mitchell, a member of the firm’s Workout, Restructuring and Bankruptcy practice group, was quoted in “Commercial Owners Can’t Tame Debt Nightmare” in Banker & Tradesman on April 27. The article discusses imminent default and maximized net present value recovery, the two concepts borrowers and investors are leaning on given the absence of a functional refinancing market. Beth notes that the argument that certificate holders stand to benefit more by extending loans, rather than forcing property liquidations upon an illiquid marketplace, “is not an unusual view for a defaulting borrower to take.” “The challenge for the lender is, are you better taking a loss now, or delaying action and potentially taking a loss later? At which point is it worse for the overall portfolio? The expectation of the borrower is that, if they extend the loan, they’ll end up with a better market down the road. That’s not necessarily the case.”

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