Real Estate Workouts, Bankruptcies & Foreclosures

The Built Environment


In the wake of the market collapse of 2008 and the ensuing period leading to the current marketplace, Blank Rome’s attorneys have advised and continue to advise clients in a variety of distressed or potentially distressed situations. Our attorneys with expertise in real estate, litigation, bankruptcy, tax and UCC enforcement assist clients in developing a transaction-specific approach and team. We also assist in the analysis of the issues; the strengths and weaknesses of the client’s position and the positions of the other interested parties; the characteristics of the particular distressed assets; and the cast of characters in the proceedings, which can be of crucial importance in formulating strategies. We clearly present the probable outcomes of different courses of action and, once a strategy is developed with our client, we implement that strategy in the most effective way.

If problems cannot be resolved by negotiation, we have litigators with expertise in real estate-related litigations in state and federal court, including federal bankruptcy court. Our commercial litigators and bankruptcy lawyers are adept in the particulars of real estate disputes and how they affect different asset classes, such as offices, multi-family projects and hotels.

Our Practice

Blank Rome attorneys possess the skill and knowledge to assist clients on a variety of real estate restructuring matters, including:

  • Contested foreclosures
  • Borrower bankruptcies
  • Assumption, assignment, and rejection of real property leases in bankruptcy proceedings
  • Bankruptcy asset sales
  • Loan restructurings, including conversion of debt to equity and participating loans
  • Forbearance agreements
  • Discounted pay-off agreements
  • Recapitalizations and deeds-in-lieu of foreclosure
  • Sale and purchase of distressed debt
  • Extensions of time for a debtor-in-possession or trustee
  • Appointments of receivers

As the real estate market continues to fluctuate, we counsel clients on curing of defaults and other claims issues and how to handle the confirmation process in Chapter 11 cases.

Our Awards & Recognition

  • Ranked in Chambers USA in 2010, 2011, 2012, and 2013, and recognized as a leading real estate practice offering a diversity of expertise ranging from transactional work to zoning and land use matters. Sources tell Chambers that Blank Rome:
    • “Provides the highest quality legal advice in a business-oriented and cost-effective manner. A go-to team of excellent practitioners that is well known for its real estate expertise.”
    • “They are accessible, available and effective, and they got the job done. They're experienced, smart and competent."
  • Ranked in Chambers USA 2013, Craig Lord is noted as having a "stellar reputation" and "very capable and well versed in deal-making."

Our Clients

  • mortgage lenders
  • mezzanine lenders
  • special servicers
  • holders of CMBS tranches and a variety of borrowers and investors with differing positions in the capital stack
  • buyers and sellers of distressed debt
  • commercial landlords (including shopping center owners) and tenants
  • debtors, creditors and other claimants in real estate-related bankruptcy proceedings 

Our Successes

  • The owners of an iconic New York City office building in a $210 million prepackaged bankruptcy that resulted in restructuring of debt and equity positions that benefited our client by more than $80 million. The company emerged from bankruptcy 36 days after filing – one of the fastest turnarounds in the Southern District of New York – despite the involvement of multiple parties located in several countries.
  • A developer in connection with the restructure and modification of construction loan for development of a 48-unit residential condominium project in Philadelphia, Pennsylvania.
  • A large national bank and its affiliated lending company in connection with a consensual but highly contentious bankruptcy relating to a midtown Manhattan hotel and residential condominium project. While the bankruptcy proceeding was pending, the hotel was sold to a large Chinese company, several residential units were sold to third party buyers and, several months after the hotel sale, the residential condominiums were refinanced by the debtor in a transaction that repaid the bank and its affiliate in full.
  • A joint venture between a New York city-based developer and a large private equity fund to acquire from an insurance company a performing but distressed mezzanine loan relating to an office complex in Stamford, Connecticut.
  • The owner of a major office building in Broward County, Florida in connection with a work-out of a defaulted CMBS loan which was transferred to the special servicer upon loan maturity, including defense and settlement of foreclosure action, tax, bankruptcy and structuring strategies and negotiation of forbearance agreement which included term extension and changes to cash management, leasing and reserve provisions.
  • Distressed loan sales for a national bank, including (i) a sale of a foreclosure judgment, (ii) a sale of a pending foreclosure action shortly after it was commenced, and (iii) a pre-packaged (consensual) bankruptcy in which the bank and its borrower cooperated to sell the property to an unaffiliated third party.
  • An owner of a historic building in Manhattan’s SoHo neighborhood in an extended loan workout, including the defense of a foreclosure action, forbearance arrangements and ultimate debt refinancing.
  • Mezzanine lender in connection with the exercise of remedies, including UCC foreclosure and ultimate full repayment of a defaulted mezzanine loan secured by membership interests in an entity owning an office and industrial property in southern New Hampshire.