Remaining Proactive When Managing Distressed Debt

With the coronavirus pandemic sparking an economic downturn in the commercial real estate markets, several large private equity firms have started to capitalize on opportunities by raising capital for distressed debt funds.

Companies such as Carlyle Group, Starwood Capital and Oaktree Capital Management have all announced new distressed debt funds since March 2020. The Wall Street Journal announced in early April that there were 939 commercial-property funds targeting distressed debt. Another publication, The Real Deal reported that one firm raised $1.3 billion in just two weeks. According to Preqin, there is approximately $142 billion of capital looking to purchase distressed debt.

When managing distressed debt funds, it is important to centralize your data in order to understand and mitigate risk. RealINSIGHT consolidates your data and sources in one place and then adds a layer of actionable insight.  RealINSIGHT software allows fund managers to make decisions in real-time and work proactively to reduce potential problems. Our technology has specific workflows for distressed debt that include:

  • Alert notification system

  • Stratification of important risk factors

  • Management of loan modifications, foreclosure and REO

  • Default and special servicing management

  • Forbearance tracking

The ability to track tenant and borrower management, changes in debt service, list transfers and upcoming lease expirations allow you to see the whole picture of your portfolio. Additionally, RealINSIGHT combines your data with public data to identify potential issues including, weather events, interest rates, indexes and more. With a full capital stack management system, you can report on your entire portfolio at the touch of a button.

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