MIAMI-First Market Properties, a real estate company specializing in buying and selling distressed assets, purchased $15.6 million in multifamily debt on August 3. The all-cash purchase was for non-performing loans on 17 properties in Miami-Dade and Broward Counties.

The seller was J.P. Morgan Chase, according to industry sources, who also estimate that the debt was purchased at an approximately 50% discount.

Now that First Market Properties, which has offices in Florida and New York, has purchased the loans, the firm plans to sell them to other investors or finish foreclosing on the properties and sell them, says Aaron Kurlansky, head of South Florida acquisitions for the firm.

Alternatively, says Kurlansky, First Market Properties could work out deals with the borrowers to give the firm deeds in lieu of foreclosure, or they might qualify for a forbearance agreement.  “We could either lower their interest rates or maybe the principal,” but they would first have to show that they had sufficient cash flow, he says.

The loans which First Market Properties bought run anywhere from $300,000 to $3 million and the borrowers are mostly smaller local investors, says Kurlansky. The properties, which have from five to 40 units each, were built within the last forty years, he says.  Berger Commercial Realty Corporation in Ft. Lauderdale is one of the brokers which First Market Properties is planning to use to sell the debt or the properties, he says. The company was a receiver for many of them.

“This transaction shows that the market for non-performing loans is still strong for experienced buyers who have the ability to work with banks on all-cash deals which can close quickly,” says Kurlansky. First Market Properties closed on this deal within two weeks, he says.