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Course Details

Course Information
  • smart_display Format

    On-Demand

  • signal_cellular_alt Difficulty Level

    Intermediate

  • work Practice Area

    Real Property - Finance

Date & Time
  • event Date

    Tuesday, April 2, 2024

  • schedule Time

    1:00 p.m. ET./10:00 a.m. PT

  • timer Program Length

    90 minutes

Credit Information

  • This 90-minute webinar is eligible in most states for 1.5 CLE credits.

$347.00
CLE
ALL

This CLE webinar will examine the key features and documentation of commercial mortgage loan transactions in today's market. The panel will discuss provisions of particular concern to borrowers and lenders, typical negotiating points, and securitization or syndication parameters which may limit the lender's flexibility.

Faculty

Andrew Maguire
Shareholder
McCausland Keen & Buckman

Mr. Maguire counsels REITs and other publicly-traded companies, as well as privately held entities and family office clients. He negotiates, documents, and closes acquisitions, dispositions and financings across the spectrum of commercial real estate sectors, including apartment properties, self-storage facilities, retail centers, office buildings, medical facilities, hotels, and industrial properties. Mr. Maguire also has significant experience representing national and regional landlords and tenants in a wide range of leasing matters.

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Virginia Rolfes
Partner
Nelson Mullins Riley & Scarborough LLP

Ms. Rolfes is a real estate and finance attorney with more than 15 years of experience. She is experienced in commercial lending, asset management, finance, leasing, and general real estate matters. She has experience in originating commercial real estate loans that are securitized and sold on the bond market (also known as commercial mortgage backed securities or CMBS). Ms. Rolfes represents banks and other lending institutions making loans on commercial properties such as office developments, retail centers, hotels, and manufactured housing complexes, among others. Ginger also works with tenants in the negotiation of a variety of leases and related issues and regional developers in the purchase and sale of commercial properties.

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Matthew L. Strayer
Partner
Bricker & Graydon LLP

Mr. Strayer represents buyers, sellers, owners, developers, and lending institutions on real estate projects involving retail, hospitality, industrial warehouse, and other uses and industries. He also has experience representing landlords in relation to commercial leasing and other end uses. Additionally, Mr. Strayer represents construction and permanent mortgage lenders in the negotiation and documentation of new and restructured commercial loans.

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Description

Documentation of real estate loan transactions has grown increasingly complex over the years. Commercial loans now generally include a note, mortgage and security agreement, loan agreement, assignment of leases, environmental indemnity, financing statements, cash management agreement and guaranty, and require negotiation of a myriad of issues relating to the borrower and its operation of the property.

The lender seeks protection of its collateral and as much control, information, rights, and remedies as possible. It may also require certain features that allow for securitization or syndication of the loan. Consequently, the lender's loan documents generally cover a broad set of issues and impose various obligations and restrictions on the borrower.

In reviewing and negotiating the documents, the borrower wants to ensure that they properly reflect the business deal and do not impose obligations that are inconsistent with the way the borrower leases and operates the property. The borrower wants to limit the extent to which personal liability is imposed on the borrower or its principals (including for environmental matters). Prepayment and due on sale provisions can also be critical points of contention.

Listen as our authoritative panel discusses the key concerns of borrowers and lenders in negotiating commercial mortgage documents and the extent to which certain provisions can be negotiated in a given transaction.

Outline

  1. Review of primary loan documents
    1. Promissory note
    2. Mortgage and security agreement
    3. Loan agreement
    4. Assignment of leases and rents
    5. Guaranty: recourse vs. non-recourse
    6. Environmental indemnity
    7. Cash management agreement
    8. Loan commitment or term sheet
  2. Key provisions
    1. Conditions precedent to funding
    2. Personal liability
    3. Events of default: notice and cure rights
    4. Prepayment/defeasance
    5. Due on sale or transfer
    6. Lease approvals
    7. Reserves and cash traps
    8. Condemnation and casualty
    9. Insurance
    10. Cross-default with cross-collateralization
  3. State of the market: current thoughts

Benefits

The panel will review these and other critical issues:

  • From the lender's standpoint, what deal points must be included in a loan agreement? When might "short form" documents be available for smaller deals?
  • How have securitization and syndication affected structuring and documenting real estate loans?
  • What provisions are of the most concern to the borrower, and to what extent can they be negotiated?