Commercial properties are taking a huge hit in metro Atlanta
area. According to a report released April 20 by Atlanta consulting
firm Bleakly Advisory Group, the coronavirus pandemic may push
retail vacancy across metro Atlanta to at least 40%, creating an
unprecedented challenge for mall owners and other landlords.
Socially-driven businesses, such as restaurants, lounges and clubs,
also have experienced a record-breaking economic loss.
A property owner half-way through their mortgage loan could face
dilemma if the property cannot generate enough cash flow to remain
current on their payments. Many loan companies are offering a grace
period, but that may not be enough to save some businesses. An
owner may have to liquidate the property to cover the mortgage,
which at the current market situation may result in him/her losing
the majority, even all, of his/her equity in the property. It is
every possible that the owner will end up in debt.
As a company based on the principle of supporting and improving
communities, UC Asset is offering property owners in this situation
an opportunity to partner with the company to save their own
equities. The basic concept is for UC Asset to acquire part or all
of a property of concern, by issuing preferred shares to the
current property owner. The current property owner will become a
preferred shareholder. Depending on the structure of the deal, UC
Asset will take responsibility in paying the mortgage for at least
a long enough period till the pandemic crisis is over, or, in a
whole acquisition deal, UC Asset will pay for all remained mortgage
balance.
Under this arrangement, the property owner will retain his/her
interest in the property. Even under a whole acquisition deal, the
property owner will be entitled to receive profit as a preferred
dividend, from the continuous operation of the property.
"Partnering with distressed property owners is a bold move for a
relatively young company. It can be a risky offering if the
pandemic will lead to a longer recession that lasts for years,"
said Greg Bankston, managing partner of UC Asset’s GP. "We believe
the recession caused by COVID-19 will be sharp but short. In 12 to
24 months it will be over. The value of these properties will
regain, and the cash inflow will recover. The investment we are
making today will not only provide relief to local business and
property owners for now, but also yield great return for our
investors in the near future."
UC Asset is structured as a Master Limited Partnership (MLP)
rather than a real estate investment trust (REIT) in order to focus
on long-term value growth. The company is among one of the very few
real estate MLPs trading on US public markets, and the only one on
OTCQX. This unique legal structure empowers UC Asset to take a
longer-term approach to real estate investments, because MLPs do
not have to constantly make cash distributions as REITs are
required to do.
"UC Asset can leverage all its cash to buy in properties, which
is especially advantageous in distressed times when cash is king,"
says Larry Wu, UC Asset founder. "This is a critical part of our
strategy to stay ahead of the curve. Last month we liquidated two
residential properties before the residential property price
responded to the pandemic crisis. Our cash position is robust after
that move. Now we are entering into commercial property market,
where the property price had taken a much harder hit, and we are
ready to write checks. Furthermore, we are in negotiation of
raising more capital from high-net worth investors, and hopefully
we will close some deals soon."
About UC Asset LP
UC Asset LP is a limited partnership formed for the purpose of
investing in real estate for development and redevelopment,
concentrating in metropolitan areas of Atlanta, GA and Dallas, TX.
For more information about UC Asset, please visit: www.ucasset.com
Disclaimer:
This News Release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements involve known and unknown risks,
uncertainties and other important factors that could cause our
actual results, performance or achievements, or industry results,
to differ materially from any these statements. You are cautioned
not to place undue reliance on any those forward-looking
statements. Except as otherwise required by the federal securities
laws, we undertake no obligation to publicly update or revise any
forward-looking statements after the date of this News Release.
None of such forward-looking statements should be regarded as a
representation by us or any other person that the objectives and
plans set forth in this News Release will be achieved or be
executed.
View source version on businesswire.com: https://www.businesswire.com/news/home/20200507005674/en/
Contacts
Christal Jordan | Investor Relations Director, UC Asset LP
cjordan@ucasset.com | 678-499-0297