Court-Appointed Receivership

Court-Appointed Receivership

Brith Sholom House aerial viewProject Overview

SREA Property Management appointed Receiver for a 360-unit affordable senior housing building in poor condition, tasked with stabilizing and marketing the property.

Challenges

  • More than 207 L&I violations; unsafe, deemed a public danger.
  • Lack of heat, hot water, and basic maintenance; squatters present.
  • Building in disrepair with uncleaned common areas and no maintenance supplies.

Key Actions

  • Repaired fire/life safety issues, provided 24/7 security, and restored basic services.
  • Lender investments of $1.5M to address 70% of violations and improve living conditions.
  • Reduced operating expenses, ensured insurance coverage, and reported to the court.

Marketing Success

  • Broad marketing reached 109,000 contacts; received 4 offers, with PHA increasing theirs to $24M after negotiation.
  • Negotiated settlements with lienholders, securing $881,534 in additional proceeds.
  • Avoided nearly $400K in transfer taxes due to PHA’s exemption.

Results/Value Creation

Nine months after appointment, Receiver and Lender worked closely together to accomplish the following:

  • Stabilized the physical plant to re-establish and provide consistent delivery of basic services
  • Avoided Philadelphia Sheriff Sale excessive process delays and 3% sheriff sale fees by executing a short sale with PHA for $24M, and facilitated numerous lien settlements.