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Developers Will Focus on Troubled Assets

NEW YORK CITY-Led by Scott Aaron and Scott Heller, Benchmark Real Estate will pursue development opportunities in the residential and hospitality sectors.

By Paul Bubny | Updated on April 23, 2009

NEW YORK CITY-Benchmark Real Estate Partners, a boutique development firm launched by commercial veterans Scott Aaron and Scott Heller, aims to make lemonade out of the lemons that are “busted hotel and condominium projects,” as Aaron puts it. The new company’s primary focus is to pursue development opportunities in residential rental and hospitality projects, and also to provide alternate exit strategies and workouts for lenders, private equity funds and owners of distressed assets.

“We fill the void,” Aaron tells GlobeSt.com. “We’re developers and operators, and we have no failed projects of our own to deal with, so this is an opportunity for someone with a clean plate to work with the developers or equity firms to extricate themselves from these bad situations.”

Aaron says there are opportunities for Benchmark “on two fronts. Construction pricing has come down significantly, so landowners with very low bases are now able to affordably build rental housing, whereas for the past few years construction pricing was so high that it’s been cost-prohibitive. At certain points they were looking to sell the land for incredibly high prices–and that option of course is not available to them any longer–or build condo units or hotels. Luckily for the guys we’re working with, they didn’t start construction. So they’re still sitting with land, and they’ve retained us to go ahead and look at constructing rental housing.”

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