Owners Page

Equity Capital: Mokhus works with owners of real estate. primarily as an investor and equity source to help an owner acquire an asset, most often in an arrangement with Mokhus participating on the sponsor or investor side of the deal. Mokhus seed capital combined with equity partners is invested in a joint venture or other structure with the owner, specially tailored for each project to suit the needs of our investors and operating partners. If we decide a project is not for Mokhus or its partners, we may still help by making an introduction to an interested equity party

Debt Financing: Mokhus will take the lead in assembling the debt package when it invests or consults with an owner. Mokhus, as an equity investor and advisor is not itself a lending institution, but the firm has hundreds of relationships with lenders, wall street firms, regional banks and specialty debt shops, with new ones forming every week. Mokhus’ track record demonstrates that we bring the most competitive debt package available to fund development projects and create the best capital structure to maximize return on equity investment and mitigate financial risk.

Financial and Strategic Consulting: Mokhus assists development partners on a variety of issues, either as an investor or outside consultant. These issues include acquisition and disposition strategy, highest and best use, valuation, asset management, deal team management, lease consulting, marketing strategy, recapitalization, negotiations with partners and lenders, restructuring, reorganization (including Chapter 11) and exit strategy.

Asset Evaluation: Sometimes owners have control of an asset or portfolio which is new to them through an estate inheritance, an auction bid or other reasons. In these cases, an understanding of the asset in terms of value, highest and best use, marketability and existing or potential liabilities is extremely important, The initial asset review should done quickly and efficiently as time can erode the value of assets if a strategy based on analysis is not followed. Mokhus looks at every aspect of an owner’s assets, including the physical, financial, and operational and leasing aspects of such. Our recommendations enable the owner to protect assets from deterioration. Our action plan for the asset will help the owner unlock the best long and short term value for the owner and his investors. Mokhus will also participate in the forward strategy as well, as its development or operating partners, combine with Mokhus investor capital to create a single solution, under one roof.

Deal Sourcing: Owners are often seeking new asset purchases, for 1031 exchange, tax strategy, depreciation management, roll-up of a pool of assets or other reasons. Mokhus is known for identifying a regular flow of interesting deals across the U.S. and overseas and can partner with owners on these initiatives. We most often work directly with principals rather than brokers, but maintain strong relationships with brokers in our markets. Our primary deal sourcing comes through the strong relationships we have built with funds, lenders, owners, operators and professional firms across the country. The best deal opportunities from Mokhus are those that we assemble ourselves, as "off-market" transactions through our work with developers, lenders and other parties. Developers seek to find buyers for their completed projects, and lenders have balance sheet assets due to borrower default or bank takeover which need to be monetized through a real estate solution provided by our team. Mokhus often brings these opportunities to owners of real estate.

Special Partners: Mokhus grants special status to a select number of ownership and operating groups: Mokhus Selected Partners. These partners get right of first refusal for our off-market transactions and we often call on them to participate in our consulting and advisory projects when specific expertise is required. When Mokhus raises capital from investors for our projects or investment fund, we package the best deals in the pipeline of our Selected Partners (limited to one per asset class and region) into an investor presentation to showcase their abilities as owners and operators. Their portfolio, acquisition track record, management and business plan are all reviewed. The intended result is that projects of our Selected Partners are funded first, with the best possible deal structures for owners, often giving them carried interest and profit splits that fall well beyond industry averages.

Case Study One: Mokhus is recommended by an attorney to an owner who asks us to help him with two 15,000 Sq. foot retail properties in a prime location which the owner has held for a generation, but is now hoping to monetize for estate planning purposes. The buildings were bought 20 years ago for $4 Million. There has been limited interest from prospective buyers due to the low NOI due to a long term triple net lease with 7 years remaining. Also, the building is owned in a partnership with two other parties, and there are partnership disputes. Mokhus does a full analysis on the deal and then works with the partners to resolve the dispute by demonstrating the optimum investment strategy. Mokhus then offers to buy the buildings for $30 Million plus up to a $5 Million earnout which Mokhus adds to solve the partnership dispute. The owner accepts and the owner is paid $24 Million at closing with $6 million to be paid upon the successful resolution of lease negotiation with one key tenant per purchase contract. The negotiation is successful after $30 days and the owner gets the $6 Million within 120 days of closing. Mokhus then does additional restructuring on the building, including utilizing air rights to reconfigure it, and after a 3-year hold, sells one of the two buildings for $31 Million, which triggers the earnout to the former owners.

Case Study Two: An owner is referred to Mokhus by his regional bank, He has purchased a vacant historic 80,000 sq. foot building in the downtown of a tier two city. He restores the building and sells half of it as condominium units. The remaining half of building, for offices and retail tenants, is in the lease-up process, but it is at 28% occupancy. The owner contacts Mokhus, as it requires funds to pay off a $15 million loan balance which will go into default due to NOI minimum requirements in the debt covenants. The NOI for the property, at $500K, is $1.5 Million below underwriting projections, due to the failure to lease the remaining space and lower rental rates than expected. The owner is on a personal guarantee for the loan for $8 Million. Mokhus, seeing the value in the project, provides $1.5 Million in equity to pay off a portion of the accrued interest and extend the loan, with a commitment to provide at least $3 Million more at the resolution of certain issues. Mokhus then brings a new specialty lender to the deal which provides a $10 Million new first mortgage, and Mokhus, with investor provide $3.5 Million so that the original loan is paid off in full before expiration of the extension. With the new lender, the guarantee is reduced to $3.2 Million. Mokhus then, reviewing the owner’s portfolio of other assets, identifies two vacant lots with development rights and gets the new lender to use one of these as collateral instead of a guarantee requirement, releasing the owner from having personal assets at risk. Mokhus also takes a partial stake in the lots for $1.8 Million. Mokhus works with the owner to develop a new strategy for the vacant space toward entertainment and restaurants. Mokhus brings both the developer and two restaurant operators to the project. Upon stabilization, NOI is $2.2 Million and the property is valued at above $35 Million, with future upside in the development of the new lots.

Mokhus bases its work with owners according to the firm’s criteria for asset types‚ transaction sizes and regions of focus. We seek to partner with the best owners and operators in our target regions; with first rate teams, a solid business plan, demonstrated ability to acquire and manage assets and ability to succeed in spite of tough challenges. We encourage our partners to understand and respect the Mokhus Philosophy in their work with us. Mokhus chooses to work with people that we enjoy- we thrive on our work and want it to be fun in the end. Life is too short to work with less than the best