Carl Marks Advisory Group Advises PJ Finance's Unsecured Creditors Committee To Achieve "Par" Recovery

NEW YORK, July 9, 2012 /PRNewswire/ -- PJ Finance Company LLC, owner of 32 apartment complexes with nearly 10,000 units located in major metropolitan areas throughout the Sunbelt region, has successfully completed a Chapter 11 plan of reorganization.  The investment banking group of Carl Marks Advisory Group LLC served as financial advisor to the Official Committee of Unsecured Creditors (UCC).

PJ Finance sought protection under Chapter 11 due to pressures from declining occupancy and cash flow. At the time of the filing, more than 1,700 units were offline and occupancy rates at near historic lows.  Through the Chapter 11 process, the Debtors worked in conjunction with the UCC and Torchlight Loan Services LLC, the special servicer of $475 million senior mortgage notes, to rehabilitate the properties and right size their capital structure.  An auction with financing support was formulated to maximize value and select a sponsor for a consensual plan of reorganization. Following a highly competitive and extensive auction, the existing equity owners of the properties, in conjunction with affiliates of Starwood Capital, became the sponsors of the plan of reorganization under which $22.5 million in new capital was invested along with the assumption of mortgage notes. Notably, the plan also makes payment to all general unsecured creditors in full.

"The Chapter 11 process and the cooperation of all the stakeholders yielded substantial value recovery, a testament to the possibilities available to creditors in a dynamic bankruptcy process," said Christopher K. Wu, partner, Carl Marks Advisory Group. 

"Carl Marks showed us outstanding creativity, a strong voice of advocacy and persistence in achieving this remarkable result," said Alberto Carrizal, chairman of the Unsecured Creditors Committee. 

The Carl Marks team was led by Christopher Wu and Scott Webb.  Mark Power and Joseph Orbach of Hahn & Hessen served as counsel to the UCC.

About Carl Marks Advisory Group LLC and Carl Marks Securities LLC 
Carl Marks Advisory Group LLC, with offices in New York, Bedminster, N.J., and Charlotte, N.C., provides a wide array of investment banking and financial, operational, real estate and healthcare advisory services to the middle market, including mergers and acquisitions advice, sourcing of capital, financial restructuring plans, strategic business assessments, improvement plans and interim management. Carl Marks Advisory Group is the  recipient of the 2010  Turnaround Management Association's Turnaround of the Year Award in the Large Company category, the 2011 M&A Advisor's Debt Financing Deal of the Year, and the 2011 Turnaround Atlas Awards Chapter 11 Reorganization of the Year – Middle Markets.

Carl Marks Securities LLC, based in New York, assists its clients in executing private placements of debt and equity. The firm is a member of FINRA and SIPC. Additional information about Carl Marks Advisory Group LLC and Carl Marks Securities LLC is available at www.carlmarks.com.

SOURCE Carl Marks Advisory Group LLC

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