Distressed property: Preserving value and mitigating risks

Security review and asset protection / sale of assets

Step 1: Security review and asset protection

1. Identify assets critical to maximising realisation.
2. Review securities to ensure control of all relevant assets.
3. Identify risk factors.

Risk factors include:

• Third party interest
• Legislation
• Environmental issues
• Restriction on buyers - Seniors Living SEPP
• Security cross collateralisation
• Water rights

Step 2: Sale of assets – maximising value

1. Methods of sale: private treaty, auction, formal tender, EOI or informal tender.

2. Pre GFC:

   When the economy is booming and assets are easier to sell and purchasers have no difficulty obtaining finance auctions are prevalent as it creates momentum and an urgency which can contract the sale process. the faster assets are disposed of the quicker money is returned and holding risk is reduced.