Structuring Preferred Equity Investments in Real Estate Ventures: Impact of True Equity vs. "Debt-Like" Equity
Negotiating Deal Terms, Investor Return, Change in Control Provisions; Assessing Remedies, Tax, Bankruptcy Issues
Note: CPE credit is not offered on this program
Recording of a 90-minute premium CLE webinar with Q&A
This CLE webinar will discuss structuring preferred equity investments (PEIs) from both the perspective of the sponsor and investor and explain the advantages and disadvantages to using preferred equity as a component of a capital stack. The panel will review how PEIs compare and contrast with mezzanine financing and other equity investments, discuss the critical agreement terms and trends in the current market, and outline approaches for negotiating terms and provisions.
- Total return for the investor
- Preferred equity vs. mezzanine debt
- Structuring the preferred equity deal
- Remedies for default
- Change in control issues
- Bankruptcy ramifications
- Tax ramifications
The panel will review these and other key issues:
- What are the primary benefits and risks of PEIs compared to other equity investments or mezzanine financing?
- What are the key provisions that counsel to either the investor or the financing recipient must understand and negotiate when structuring the PEI agreement?
- How should counsel to a preferred equity investor address potential default, change in control or bankruptcy by the financing recipient?
- What are the most crucial tax consequences that can arise out of preferred equity financing and how can counsel anticipate and mitigate those consequences?
Ms. Austin focuses her practice on matters including the representation of institutional, fund and private capital... | Read More
Ms. Austin focuses her practice on matters including the representation of institutional, fund and private capital sources in the origination, purchase, disposition, and restructuring of senior and mezzanine real estate and corporate loans, loan participation interests, and preferred equity investments with respect to every major asset type, including multifamily, retail, industrial, office, hotel, mixed use, rental and re-sale condominium and student housing properties.Close
Mark S. Fawer
Mr. Fawer is a partner in the firm’s Real Estate group, where he focuses on representing senior and mezzanine... | Read More
Mr. Fawer is a partner in the firm’s Real Estate group, where he focuses on representing senior and mezzanine lenders, developers, real estate debt and equity funds, REITs, CDOs, and investors in the acquisition, financing, development, refinancing, recapitalizing and sale of single-asset and portfolios of multifamily, retail, industrial, office, and hotel properties and the origination, purchase, disposition and restructuring of senior and mezzanine real estate and corporate loans and loan participation interests. He writes and speaks extensively on the subject of intercreditor and co-lender agreements and arrangements.Close
James B. Mann
Mr. Mann has over 25 years of experience serving as a trusted advisor to a broad range of stakeholders in the energy... | Read More
Mr. Mann has over 25 years of experience serving as a trusted advisor to a broad range of stakeholders in the energy and financial services industries. He counsels clients on the new changes in the tax law, as well as cannabis tax issues. Mr. Mann advises financial institutions regarding international tax, structuring renewable energy asset-based bank loans and securitizations, cross-border tax-advantaged partnerships and securitizations, project finance, and renewable energy deals.Close