Niche Sector Unlocks Trapped Value in Risky Properties

HOUSTON—Corporate-owned legacy and surplus property is a growing niche within the larger corporate real estate sector.

As a reflection of that growth, Savills recently added Mark Alvarez as a senior managing director specializing in surplus property services. Based in the Savills Houston office, he will lead the new offering and serve as the firm’s subject matter expert on impaired properties.

Savills Surplus Property Consulting Services advises businesses and investors on divestment strategies and best practices for monetizing assets and mitigating risk on compromised real estate at a single site or across a portfolio. Its program focuses on capturing the reuse value and mitigating the risk associated with divesting such properties.

“In the last five years, we have made continuous efforts to expand our advisory services to offer a broader, more holistic perspective for our industrial and logistics clients,” said Adam Petrillo, senior managing director, head of industrial services. “Mark’s industry-leading experience and unique approach to optimizing outcomes at the intersection of real estate and risk management will greatly benefit our new and existing clients, especially those seeking to unlock trapped or intrinsic value in properties otherwise too risky to touch.”

Alvarez joins Savills with more than 25 years of experience in managing multi-million dollar portfolios of legacy or surplus property. Alvarez and his team have extensive experience in developing, underwriting and planning the reuse of impaired real estate. Its clients include multinational companies, investment banks, commercial developers and public agencies.

Prior to Savills, Alvarez spent four years as the director of the surplus properties program at Arcadis, where he managed all aspects of portfolio management for a wide variety of multinational clients. From 2012 to 2015, he worked as the regional regeneration manager for North America at BP America Inc.

“The firm has invested heavily in forward-thinking solutions and strengthened its professional teams across North America, and I look forward to leading and expanding our offering in the area of impaired properties services,” Alvarez said.

Savills Surplus Property Consulting Services helps clients reduce liability and creates a value-add divestment strategy–whether on a single property or an entire portfolio. Core services have expanded and now include due diligence, valuation, reuse analysis, remediation strategy, transaction management, financial-reuse underwriting and divestment strategies. Its specialists are experts in strategic divestment and risk mitigation.

“The fundamental difference with our program is our approach to characterizing properties: we’ve learned that understanding the reuse–and planning the remedial strategy around a reuse plan–can drive a more efficient remedial strategy with cost savings upwards of 30%,” Alvarez tells GlobeSt.com.  “Furthermore, with our integrated services, we can now offer our clients access to private equity, brokerage and project management services, effectively creating a full-service program from initial site due diligence to divestment.”