Seeing the diamond in the rough
For 601W and its investors, Sophistication is defined as the Art of Mastering the Complex… It means understanding that there is no detail too intricate, no resource beyond reach, no line item too insignificant to consider… Sophistication means having the knowledge, instincts and experience to pursue a deal, how to acquire and structure it… and when to withdraw from an acquisition… It is the wisdom to look at hundreds of deals, but only target a fraction of them.
Sophistication means seeing deals where no one else looks, opportunity where others see too much work and little promise, and outsized profits where others see none... Sophistication – to our investors it means, the ability to build complex structures with a deep understanding, imagination, and vision as well as great attention to details.
The Prudential Plaza in Northeast Chicago was once a magnificent and iconic office structure with continuous upper 90% occupancy comprised of top tier tenants. But when the former owner fell on difficult times so did his ability to maintain the property and retain those tenants, and, as the vacancies increased, the sizable mortgages went into default. Seizing an opportunity in a city 601w knows well, over an 18 month period of complex negotiations, its managing members
structured an outstanding workout with the owner and the debt holders, to discount the mortgages and take control of the property (valued at $650M just five years earlier) with a $75M cash investment (to be funded in order to attract and lease the property to high caliber new media tenants), allowing 601w and its investors to potentially realize tremendous profits in a preferred position to much of the restructured debt.