Hilco

Lunch + Learn WebinarApril 25, 2013

You’re Sitting On Distressed Real Estate….Now what?

Hosted by:Lerry Knox Navin Nagrani

CEO, Hilco Innovation SVP, Hilco Real Estate

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Asset Disposition Services Asset and Enterprise Valuation Services

Asset Acquisitions and Investments

♦ Tangible and Intangible Asset Appraisals

– Inventory

– Machinery & Equipment

– Real Estate

– Accounts Receivable

– Intellectual Property

♦ Enterprise Valuations

♦ Valuations for Tax, Reporting, Accounting and Compliance Requirements

– FAS 157, 141, 142

– IFRS Compliant Valuations

♦ Insurance Valuations

♦ Ad Valorem

♦ Asset Verification and Tagging

♦ Estate Settlement Valuations

♦ Valuation Dispute Litigation Support

♦ Monetization Services for All Categories of Industrial Assets

– Webcast, Online and On-site Auctions

– Sealed Bid Tenders

– Private Treaty Sales

♦ Real Estate Brokerage and Lease Restructuring

♦ Industrial and Retail Asset Disposition Services

– Inventory

– Machinery and Equipment

– Fixtures and Equipment

♦ Intangible Asset Disposition

– Trade Names, Service Marks and Other Intellectual Property

♦ Company and Facility Wind Downs

♦ Surplus and Redundant Asset Disposition in M&A Transactions

♦ Acquisitions of Surplus and Underperforming Tangible and Intangible Assets to Provide Immediate Liquidity

– Cash, upfront

– Guarantees

– Corporate Trade Credits

♦ Real Estate Acquisitions

♦ Private Equity Investments

– Retail Companies

– Consumer Product Manufacturers

– Iconic Consumer Brands

♦ Special Situation Debt Financing

♦ Distressed Debt Acquisition

– Corporate Debt

– Real Estate Debt

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Hilco

Hilco Delivers Results:♦ Conducted over 1,800 industrial asset disposition projects

♦ 400+ Fortune 2000 clients, across all industries

♦ Sold assets from 53 countries into more than 60 countries in 2012

♦ Asset sales will exceed $1 billion in 2012

♦ Disposition of over 200 million square feet of industrial, office and retail properties

♦ Appraised and repositioned industrial, commercial and retail real estate worth nearly $4.0 billion, and restructured over 35,000 leases

♦ Market leader in recovery through market making for IP, patents and other intellectual property

♦ Delivered nearly 20,000 appraisals - values in excess of $200 Billion

♦ Converted over $150 billion of excess inventory to cash.

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Clients Hilco Has Served Across the Globe:

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Discussion Points• What is Distressed Real Estate

• Distressed Real Estate vs. Distressed Situations

• Uniqueness with real estate vs. other assets

• Vehicles to Monetize Real Estate• Traditional Brokerage

• Sealed Bid

• Private Treatise

• Open Out-Cry

• Online

• Understanding Where the action and deals are

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Opportunities And Challenges:

The Bankruptcy ArenaOpportunities

• Buy assets at discounted prices: as-is/where-is

• Public process but very few players usually participate

• More municipalities to restructure?

Challenges

• Uncertainty of outcome (Reorganize? Liquidate?)

• Difficulties in getting hired as an consultant/broker

• Lots of players at the table – different objectives/goals

• Lack of financing options

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Backdrop:

The Government Arena

Municipalities today face significant challenges reconciling increased demands for services with declining revenue and tax base, escalating labor and pension costs, and limited access to capital.

No communities are immune; and, as state and local governments strain to meet budgetary requirements, every elected official and senior administrator should be vigilant in searching for opportunities to assure their constituencies that public service delivery is a priority, and will not be put at risk because available operating revenues are insufficient to satisfy the cost of those services.

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With mounting financial pressures, some municipalities are already confronting the possibility that they will face insolvency in the near term. Yet other municipalities are concerned that their operating costs could someday soon outpace their revenue sources. With this backdrop, municipalities need to explore how best to manage their most valuable asset: their real estate portfolio.

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Backdrop continued:

The Government Arena

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Municipalities have extensive real estate portfolios. These portfolios consist of education, culture, sport, recreation, care, civil service offices and social housing. Allow for opportunities to drive value from the following:

1. The need to professionalize real estate activities Many municipalities allow departments and agencies manage their own RE portfolios. Real estate is not a principal task for these departments, as a result of which they are often not capable of undertaking real estate management professionally. If the city is to exploit the advantages of scale and the potential of the real estate optimally, the scope and complexity of the portfolios necessitate meticulous harmonization with other portfolios in the city, as well as professional management and portfolio management.

2. Real estate as a cost-cutting instrumentIn the current economic environment, municipalities are looking carefully at their expenditure and assets. Most municipalities have come to believe that selling off municipal real estate would strengthen the municipality's financial position and are actively looking for strategies to monetize this asset class.

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Opportunities:

The Government Arena

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Navin Nagrani Lerry KnoxHilco Real Estate, LLC Hilco Innovation Solutions, LLC847-504-3218 312-912-7601nnagrani@hilcorealestate.com lknox@hilcotrading.com

Additional questions? Please contact: