By: Jeff Pappas
The post-pandemic world has had such a significant impact on the commercial real estate market, from both an ownership and leasing standpoint. Companies find themselves having to downsize to reduce their commercial footprint, from office space to warehouse facilities to storefronts. Demand for distribution centers and warehouse facilities as well as office space has greatly diminished, resulting in an increased overall vacancy rate to an all-time high of 12.4%, which is 3.76% higher than the historical national average of 10.9%. The amount of sub-lease space in the market has increased 200 million square feet, which is an increase of 80 million since the start of 2020.
For the past 40 years, Active International has delivered clients with an innovative solution to gain relief from unwanted commercial real estate. Designed to create incremental value for surplus fee simple and leasehold properties, Active’s model is powered by Corporate Trade, which inherently restores value to assets that face reduced market value due to unforeseen circumstances.
Specifically, Active’s Corporate Trade model enables companies to monetize surplus real estate quickly & efficiently at prices unachievable using traditional marketing methods. Whether it’s delivering book or appraised value for a property or resolving a leasehold challenge, Active has a proven model that has solved real estate disposition challenges across industries.
Maximum Value, Professional Disposition
Working closely together with clients and/or their brokers, Active arrives at the optimal solution to deliver a significant cash premium for unwanted fee simple commercial properties and leaseholds. Christina Bouchard, Head of HR at Tata Global Beverages describes her experience with Active’s Real Estate solutions: “We no longer needed all our headquarters’ space but didn’t want to take the write-off that would occur if we sublet the space at market rent. Active’s Corporate Trade Model provided us with 100% of the cost of our remaining leasehold obligation allowing us to avoid a write-off. We’ve been extremely happy with the transaction and continue to look for other ways to work with Active.”
Active’s Corporate Trade model is flexible and transparent, and the company serves as a seamless partner to brokers. Taylor Glaze, Director of Corporate Services NAI Global/Chase Commercial, who has worked with Active’s Commercial Real Estate Acquisition team for 15 years and over 20 transactions says, “by working with Active, we expand our network of prospects and client base, increase our transaction volume nationwide, and provide incremental compensation to local brokers.”
Jeff Pappas, Active’s SVP, Real Estate, Risk Management, asserts “We work closely with all our clients in creating customized programs that specifically meet their financial goals. Our objective is to provide a flawless transaction that acquires fee simple properties at their target, book, or appraised value; helping them obtain higher rates for their distressed properties. We fund the remaining obligation of surplus leaseholds, as well as fund costs associated with lease buyouts.”
Active has worked with many well-known brands, including Fortune 500 companies to help them achieve maximum value for their fee-simple and full relief from their leaseholds across industries including CPG, Grocery, QSR and Retail.
These days, it seems like company stakeholders need to consider innovative solutions to reduce risk, strengthen balance sheets and streamline assets. It may be worth considering Active’s Commercial Real Estate solutions for distressed real estate assets. Afterall, if you’re looking for more when the market is offering less, it’s worth exploring.
To hear more about Active’s Commercial Real Estate Solutions, contact:
SVP, Real Estate, Risk Management
Mr. Pappas is responsible for the identification, structuring and execution of Active’s fee simple and leasehold real estate acquisition and disposition activities worldwide. With more than 25 years’ experience in the finance and real estate industries, he has been integrally involved in all of Active’s real estate transactions including transaction feasibility analysis, structuring solutions for undervalued properties and selling or leasing the properties once acquired.