Industry: Real Estate Development
Subject: A local development company in the process of developing a high-end condominium project in East Greenwich, Rhode Island, an affluent suburb of Providence.
Circumstance: Originally plotted for three buildings totaling 63 units, at the time of Summit’s initial involvement, only the first building with 21 units had been built and was awaiting custom interior finish. At that time, the developer’s lender was seeking an exit strategy from its construction loan portfolio and approached Summit to purchase the existing debt of the development project.
Solution: Summit moved quickly and was able to close the transaction in a little over a month. Thereafter, Summit entered into a new loan relationship with the developer, restructuring certain aspects of the loan and providing a new construction loan that would allow the developer to complete construction of the first building, clubhouse and pool so that the first 21 units could be sold.
Outcome: Unable to sell the individual units through traditional real estate brokers, as the direct result of the worst economic crisis in more than 50 years, Summit engaged an auction company to sell the units and proceeded to sell all 21 units at auction for prices well above then current expectations. The two remaining condo pad sites were held for several years until the economy improved and were then sold to a local developer.