For Lending Institutions

A growing number of lenders, including commercial banks, life insurance companies and pension funds, have unacceptable amounts of Real Estate Owned (REO) assets. Or, they may have Commercial Mortgage-Backed Securities (CMBS) loans which are in default, poised for foreclosure and unlikely to be refinanced. Lenders are also facing increasing pressure from bank regulators and stock holders to remove the REOs and under-performing loans from their balance sheets. Typically, lenders are not equipped to operate, manage, lease, sell, and, in many instances, complete construction of their real estate assets.


In order to dispose of the assets, lenders can elect to:
Dispose of an incomplete or non-performing asset at a “fire-sale” price (incur major financial losses)
Use existing staff without development experience for construction, redevelopment and/or marketing
Employ additional full-time personnel with real estate development experience to work with the asset
Retain services of Integres for strategic planning and implementation of asset disposition

Lenders who use existing staff to deal with negative situations daily may experience a decline in job satisfaction and performance, as well as a lack of focus on their core business of lending. This action has the highest risk of not achieving the ultimate performance goal.

Employing full-time, experienced real estate, management, development and construction professionals should result in better performance than the first alternative, but it also has negative aspects. This utilizes valuable time for start-up, and as the inventory of troubled assets decreases, the lender is ultimately faced with eliminating the no-longer-needed jobs. By using outside, experienced professionals like Integres, start-up time is eliminated, overhead is kept lower, and the unpleasant task of eliminating jobs is avoided.

Integres can help
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