Structuring Revolving Lines of Credit for Multiple Property Portfolios

Allowing for Draws and Repayments, Adding or Releasing Property, and More

Recording of a 90-minute CLE webinar with Q&A


Conducted on Tuesday, January 24, 2017

Recorded event now available

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Program Materials

This CLE webinar will brief real estate counsel on the advantages of using a revolving line of credit as a method of financing a commercial real estate portfolio, and on how revolving lines are structured and documented.

Description

Revolving lines of credit present a financing structure alternative for developers and other borrowers who are active in the real estate marketplace and desire the ability to acquire, develop, sell and refinance properties in their portfolios without having to enter into a new loan transaction each time. The revolving line of credit allows the borrower to draw funds as needed to finance the purchase of additional property or for other purposes, and pay down the loan balance should it sell property, without a requirement of defeasance or yield maintenance.

Listen as our authoritative panel of real estate finance attorneys discusses the legal issues and documentation of these credit facilities and the procedures for making draws and repayments (and obtaining releases). They will also discuss other attributes of these loans, which are typically short term with a floating interest rate and require interest rate hedging.

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Outline

  1. Advantages of revolving lines of credit over standard mortgage financing
    1. Opportunistic acquisition; assemblage of portfolio or sale of properties out of portfolio
    2. Ability to make draws and pay down loan balance without penalty
  2. Loan terms generally
    1. Structure Overview
    2. Procedures for draws set forth in loan documents—expedited “closings”
    3. Short term; floating rate (hedged)
  3. Documentation
    1. Borrower and entity structures
    2. Holding Company- pledge of equity interests; UCC perfection
    3. Individual borrowers and properties
      1. Joinder agreement
      2. Borrower formation documents; reps and warranties
      3. Mortgages on each property (if required)
    4. Title issues

Benefits

The panel will review these and other key issues:

  • The problems with standard permanent mortgage loans, and the additional flexibility provided under a revolving line of credit
  • How to best structure the line of credit borrower
  • Adding new borrowers under joinder agreements
  • Pledging of equity interests as security and UCC perfection issues
  • Cross-collateralization of mortgages and when mortgages are required

Faculty

Mikel R. Bistrow
Mikel R. Bistrow

Partner
Ballard Spahr

Ms. Bistrow focuses on commercial finance and lending, real and personal property secured transactions, Uniform...  |  Read More

Gordon L. Gerson
Gordon L. Gerson

Gerson Law Firm

Mr. Gerson emphasizes real estate and business transact0ions, real estate financing, and loan recovery in his...  |  Read More

Victoria J. Siesta
Victoria J. Siesta

Ballard Spahr

Ms. Siesta focuses her practice on real estate finance transactions, working directly with commercial banks,...  |  Read More

Other Formats
— Anytime, Anywhere

Strafford will process CLE credit for one person on each recording. All formats include program handouts. To find out which recorded format will provide the best CLE option, select your state:

CLE On-Demand Video

$297

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$297