Tuesday, May 19, 2009

TCC Puts Focus on Distressed Assets

DALLAS-Trammell Crow Co. has kicked its involvement with distressed real estate up a notch, with plans to acquire and manage more troubled assets during the next two to three years. To that end, the Dallas-headquartered company hired David Stahl as vice president to help coordinate the effort.

Trammell Crow senior managing director J.D. Dell tells GlobeSt.com that the company had started a program in 2005 that targeted potential value-add and distressed asset opportunities. Current market conditions, however, dictated that someone with more experience in the troubled property category be brought on board.

"We had bought what I considered to be assets of consistent type and quality that were in special situations," Dell says. "And those are the types of assets that Dave has specialized in during the past 15 years of his career."

Prior to joining TCC, Stahl was senior vice president of acquisitions and director of asset management with Lone Star Funds/Hudson Advisors. Stahl also worked for GE Capital Realty Group as a portfolio manager and was employed by Lomas Financial Corp., where he developed commercial and residential land projects.

Stahl tells GlobeSt.com that the TCC strategy for targeting the troubled assets is "buy, fix, then ultimately sell the asset." He adds that there is a "tremendous amount of volume in the pipeline" and the company is getting geared up to begin the underwriting process.

As to the types of assets being targeted, Dell acknowledges the company will examine all property types as well as medical office buildings and student housing. The targets are quality properties that will recover faster when the economy gets better. However, Dell says TCC isn't ruling out value-add potential. With the company's network of property managers and brokers, he points out, there is synergy there to fill buildings and stabilize them.

As for where these buildings should be, "we'll focus on those markets where we have a significant presence with our offices," Dell adds.
By Amy Wolff Sorter with Globest.com