The greatest value ValueXpress brings to a deal is our 30 years of experience in negotiating the best loan terms for our clients. Having completed over 400 loan transactions, we at ValueXpress are aware of all the negotiable loan provisions, and we will ensure that the loan provisions are the most favorable possible for our clients. We maintain strong relationships with investment bankers and commercial bankers that are built on years of delivering significant volume of high-quality, well-underwritten and easy-to-close loans. As a result, our relationships provide preferential treatment to our clients in terms of interest rates, speed and loan structure.
A good example of knowing “the devil is in the details” relates to springing lock boxes for hotels. These cash sweep accounts spring into place when a property Debt Service Coverage Ratio (DSCR) declines below a prescribed level, typically 1.25x. Borrowers can get caught in a trap if they are completing a PIP that temporarily depresses revenue while the owner takes rooms off-line to refurbish in accordance with the PIP. The result could be a short-term drop in revenue and net cash flow that could inadvertently trigger cash management.
To ensure that cash management is not triggered during a PIP, ValueXpress negotiates temporary relief from the provision during PIP periods. Most other advisors would never even think about this potential issue. This is just one of many terms we negotiate for the benefit of our clients that would only be known through our in-depth experience closing hundreds of CMBS conduit loans.