Rialto Capital
What have people heard about Rialto Capital Loan Workout Group based in Miami? They are the largest special servicer what would exit opportunities look like from here/day-to-day work. Here is the job posting:
- Comprehensive analysis and understanding of loan collateral dynamics, value determination, and resolution strategies
- Conduct market analysis and research
- Engagement of and interaction with third party consultants including attorneys, brokers, receivers, management/leasing companies, and appraisers
- Preparation of quarterly business plans and cash flow projections
- Thorough underwriting at the loan and property level on CMBS B-Piece acquisitions, distressed debt portfolios and performing loans in the CMBS portfolio
- Analysts will have the opportunity to underwrite loans secured by all property types, in all 50 states across the U.S.
Cannot speak personally to the job itself, but from my interactions with these Rialto folks on the borrowing side, they seem to have a good degree of autonomy, are generally pleasant and positive people, and don't express any of the bureaucracy/tedium exhaustion that the counterparts at other firms always do.
Borrowing side is very different than special servicing business. I'd do my homework on what a special servicer actually does before taking this position.
Agreed. I’ve been dealing with Special Servicers since right after the GFC, circa 2009 + and I still can’t pinpoint exactly what it is that they do.
Rialto is the largest special servicer by $ amount I believe. It's a great place start a career in CRE, and also can be a late-career opportunity for a chill WLB/consistent paycheck. TBH, it doesn't sound like the most exciting job in the world, but the experience is pretty valuable.
What do they do? They manage distressed CMBS loans and charge a 1% fee (among others) on principal balance to resolve a Triggering Event. When a covenant is tripped on a loan (DSCR falls below a certain minimum, T1 vacates at lease expiration, Borrower misses payments, Borrower can't refi or sell favorably at term, etc), the loan is "transferred" to the named special servicer of the CMBS trust. The special servicer becomes an agent to resolve the issue, which usually includes executing loan modifications, taking a property through foreclosure, suing the Borrower, etc - whatever path leads to the highest net present value for the trust. The team is typically structured where a "Loan Asset Manager" is assigned a property for the life of the deal.
Why is it a good opportunity? You get full access to property docs, usually high volume of assets, interface with borrowers, get legal training, learn loan underwriting, etc. Get paid to learn from others big mistakes.
Wow it looks like you hit the nail on the head here, this seems to be an incredibly accurate overview. In your opinion what are some feasible directions for exit opportunities (generally speaking, i.e. areas of focus)? I'm the type of person who cares about doing interesting work not necessarily making a lot of money, although I know there can (sometimes?) be a correlation.
Thanks!
I don't think it's going to limit exit opps, but if I had to be precise I'd say CRE lending. People move around within Rialto a good bit at the junior level per their LinkedIn.
CMBS is a massive administrative/bureaucratic machine, but there are people that love it - and I really can't overstate the expertise you will develop in a relatively short amount of time.
Thoughts at working on a team like this vs. a rotational program for a large developer as you start your career?
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