Client Challenge

To dispose of real estate in a declining market with high vacancies and a difficult financing environment.

Compass Commercial Approach

Compass Commercial looked realistically at the market dynamics. The supply was rising for every product type other than multifamily. Not from new construction, but from declining demand. The national economy was in a tail spin. Companies were going out of business or “right sizing” their facilities. This greatly reduced demand for all commercial space product types. Rents dropped as a result making commercial real estate less attractive to investors.

Central Oregon is perceived to be too small for most large, well-funded institutional commercial real estate investment companies. Further, it is unfamiliar territory for many smaller, regional investors. Its strength is its unique quality of life. Residents and visitors to the area are well aware of its allure. Compass Commercial determined that this group was the most likely target for purchasing special assets in a difficult market. They know and love the region and have confidence in its ability to rebound. Compass Commercial marketed the various properties nationally and internationally through Co-Star, LoopNet, CBA, the SIOR network, and the CCIM network. But, the company focused a disproportionate amount of its efforts on this group. The firm was established in 1996 and has built lasting relationships with the active participants in the area’s commercial real estate industry. This includes investors, developers, appraisers, and brokers. Compass tapped into these associations and touted the future of the area and the potential of the marketed properties. Executing the fundamentals of the business (repeated contacts to qualified buyers) resulted in sales. The Compass brokerage team honed in on those buyers known to have access to cash with existing ties to the region. No other firm has the drive to assist its clients in achieving their goals or the contacts to pull it off.

As the brokerage team was prospecting, marketing, and selling the properties, the Compass Commercial property management and development services staff was busy maintaining the properties and working with existing tenants. Assuring the continuation of the income stream of built product was vital to our clients and to prospective purchasers. Flexibility and creativity were the key characteristics of achieving the objectives.

 

Winning Results

Compass Commercial Real Estate Services has had the good fortune of completing over 120 sales of distressed assets for institutional owners. The list of sellers that we have represented includes:

• Bank of the Cascades
• Banner Bank
• Bayview Financial Services
• Columbia Bank
• Community West Bank
• FDIC
• High Desert Bank
• Home Federal Bank
• LNR
• Sterling Savings Bank
• US Bank
• Washington Mutual
• Wells Fargo Bank

And as stated above, due to our deep connections in the community and longevity in the market, we represented buyers in many of these transactions.

By aggressively pursuing the target market, we were able to maximize the recovery for our sellers/clients. Buyers with less knowledge of Central Oregon would have imputed more risk into their value calculations and required deeper discounts as a result. Further, the time required to close transactions with buyers unfamiliar with Central Oregon would have been longer. They would have demanded enough time to learn the property, the market, and the communities in which the properties were located. The end result was the highest possible prices in the shortest period of time. Compass Commercial has helped transact over $53 million in distressed sales since 2009. The results are unmatched for commercial properties in Central and Eastern Oregon.