When discussing the current state of the market, Lee explains that “opportunities are available to investors, senior lenders or other third parties in bankruptcy cases. One can potentially acquire opportunistic investments due to the bankruptcy court requirement of opening the bidding to the public on the New Cash Equity for the Plan of Reorganization.” He adds that “The parties involved in a bankruptcy, or outside non-affiliated parities, can bid on the Plan as an investment. This provides opportunistic deals for investors and strategic options for senior lenders or creditors to take control of the real estate. Of course one should always consult with legal counsel before executing a complex strategy like this.”

One positive note from the distressed assets starting to move forward in the road to recovery is an uptick in investment sales volume, states Quarton, when discussing market conditions. “The pace of the market has picked up considerably in last three to six months. Investments sales and the capital markets are starting to return to moderate mid 2000s levels. The market velocity is poised to pick up in 2011 as the CMBS maturity wave starts to rear its head.”

Quarton adds that “Banks are starting to proactively restructure deals and sell REO assets. The larger financial institutions have had roughly the past two years to enjoy healthy profits and to refinance corporate debt with record low rates due to US Treasury rates at historical lows. The net effect of these market conditions has allowed the financial institutions to deleverage its balance sheets and provide them the increased ability to work with borrowers and investors”