Whether you are concerned about equity investment or lending investments, investment loss severity risk reduction is critical to maximizing profits and minimizing liabilities. For commercial banks, commercial real estate loan loss severity risk directly impacts share price, lending and future profits. For private firms, investment loss severity risk can mean the difference between endless litigation they cannot afford, potential bankruptcy and success. That’s a pretty wide range of outcomes and only one of them is potentially good.
Our program focuses on commercial real estate investment loss severity risk management and reduction. As the industry’s only end-to-end solution, the program functions on the basis of providing liquidity management monitoring for the purposes of preventing a bankruptcy petition from being a potential outcome to an unforeseen liquidity crisis for up to a 24-month forward-looking period for the entire term of the investment.
For 1031 investors (principally beneficiaries in DSTs) this is particularly welcome news as their exposure is for an incredible 10-year period mandated by tax law.Commercial real estate income-producing properties are very exposed to market disruptions and the complexity of their operations can often lead to technical defaults due to taxes not being paid, insurance not being paid, reports not being filed or financial covenants not being observed. The INVIZEN program provides monitoring for these common maladies and that helps boost performance assurance and peace-of-mind over the entire term of the investment holding period because INVIZEN collects the property information each month of the service period.The INVIZEN RTS system is very affordable.
Here’s a set of working examples:A developer seeking capital investors to fund a $15 million development property agrees to have the INVIZEN system underwrite and then monitor the asset so that the developer can maximize the opportunity to obtain commercial real estate investment capital for the project.
The developer plans to hold the asset for no more than 5 years, so the enrollment is for a 5-year subscription period. Assuming the subscription were to go the entire 5-year period, the total cost would be $127,500. That works out to 0.85% over the entire 5-year term.
A Delaware Statutory Trust (a DST) organized for 1031 exchange investors has three (3) properties each of which was acquired for $50 million. The 1031 exchange investors have to hold the investment for 10 years, so the enrollment is for a 10-year subscription period. Assuming the subscription were to go the entire 10-year period, the total cost (discounts all being applied) would be $1,788,750. That works out to less than 1.2% over the entire 10-year term.
The INVIZEN Platform was conceptually designed to support the end-goal of preventing investment losses from being realized on commercial real estate loans and investments.
The INVIZEN Platform design construct offers an end-to-end approach that engages the project or business at whatever life-cycle stage the given project or business may be currently found to be operating within. The INVIZEN Platform is designed to provide a progressive sweep of the entire due diligence spectrum of issues with every review. It starts with the valuation of the transaction opportunity.
Collateral underwriting is important but the reality is that collateral underwriting really only comes into play for EAD calculations and insurance risk mitigation. The value of the opportunity is the real issue and the Verifier Report from INVIZEN directly addresses this issue in terms of determining if the proposed transaction is priced at a discount to market based upon the specific risk profile presented by the project, the project’s business and the project’s market. That’s the Verifier Report.
Market Risk Management
First Look is our real-time market feasibility analysis reporting system for which there is no peer. The next-gen analytics design of First Look provides testing of the empirical assumptions and findings of the market feasibility analysis to determine if a reasonable basis exists for their inclusion and/or use in the resulting report that includes detail you just can’t find anywhere else. That’s the First Look Report.
Financial Risk Assessment Underwriting
Final Check is the crown jewel of the INVIZEN Platform. Final Check provides full capacity risk underwriting, collateral risk underwriting, credit risk underwriting and default risk underwriting financial risk assessment data and findings that is backed by a post-funding monitoring program that prevents the most common causes of credit and default risk events from becoming your loss severity risk realities. That’s Final Check and there is just nothing like it.
The outflow is then matched into our unique credit risk management platform that ties credit risk (again, think hard about managing CECL) and default risk prevention program known as iCREDIT.
This unique system provides real-time forensic auditing of every transaction event and generates an entirely new set of GAAP financial statements for the benefit of all financial partners that can be accessed in real-time.
Financial reporting transparency risk, execution risk, default risk and all of the associated risks are now within the scope of being proactively managed. That’s the INVIZEN approach that makes the difference in everything we do.
We provide opportunities in the form of distressed asset acquisition opportunities for sponsors and developers that meet the specific underwriting standards and requirements of the specific funds and institutions we support.
Our compliance services focus on FINRA (we are a FINRA Compliance Vendor) and supporting broker-dealers, banks (FASB Topic 326 compliance opportunities regarding CECL), credit unions, community banks, advisors, family offices and institutions that are seeking something more than reactive data and mitigation as being the only likely outcome.
INVIZEN is about reaching your peak opportunity efficiency level and having the freedom to focus on transactions that are profitable; transactions that have the likelihood of actually closing.
Clear up your backlog of time-sensitive opportunities.
Reduce your loss reserve calculations.
Turn CECL into a competitive advantage.
Exceed expectations of regulators when it comes to compliance with FINRA, SEC, OCC or the several states.
When you engage with Rainmaker Analytics you are engaging with a team and a system that is designed to make the financial instruments your firm engages in become a matter that is manageable, less frustrating and more profitable.
Your new path forward starts with that first phone call and confidential consultation.