We’re not sure how they do with saving damsels, but the attorneys at Ballard Spahr know all about rescuing commercial real estate projects and loans in distress. The law firm, which has 150 real estate lawyers in 12 offices (locally, D.C., Bethesda, and Baltimore), has launched a new “Distressed Real Estate” practice group of 40 specialists in real estate, bankruptcy, litigation, tax, and other areas, dedicated to helping projects wobbling on the waters of today’s choppy economy. We sat down with two of the team members—Roger Winston, Managing Partner of the Bethesda office, and Kelly Wrenn, real estate and transactional finance partner in DC—to hear more.  

Roger, left, and Kelly appeared on panels this summer at the Information Management Network’s Distressed Real Estate Symposium at a not-so-distressed locale, the Bellagio in Vegas. Back in the capital, they’re advising lenders and developers on the entire range of issues that arise when a project runs into trouble. Roger, with vast experience in condos and mixed-use properties, has counseled lenders and owners of condo developments on options for projects that aren’t selling: Can they convert the whole development to rentals to get income? Can they convert some but not all of the units to rentals, creating a “fractured” development? His expertise comes in handy—more than once, he’s gotten the ultimate compliment of having other law firms call him in to consult on options for condominium and mixed-used developments.

The Ballard team also represents lenders in their quest to mitigate losses in defaulted loan situations by considering alternative workout structures such as foreclosures, deed in lieu of foreclosures, receiverships, forbearance agreements, and note sales. Beginning as a young lawyer in Texas and DC in the late 80’s and early 90’s, Kelly has many years of experience in counseling creditors as to their rights and remedies in commercial real estate loan workouts. Unlike the last commercial real estate downturn, many commercial real estate projects in the U.S. today are subject to complicated finance structures involving varying and sometimes competing debt interests which can result in complex loan workouts. While hoping to maximize recoveries on defaulted loans, lenders are often confronted with potential liability issues such as whether a lender taking back a project assumes the duty to perform on the developer’s condo warranties.

Nobody can guarantee a development will succeed, but Roger says he and Kelly have yet to find a distressed property for which they couldn’t find a positive result. Roger’s hoping to have success with a flashy investment of his own—he’s one of several local lawyers who backed the new independent movie “Red,” which stars Brian Cox and Tom Sizemore and was produced by Norman Dreyfuss. Actually, we think he got a pretty cool return on his money already—a trip to the premier of the film at the Sundance festival.

Contact Roger Winston for more info at winstonr@ballardspahr.com.