Real Estate Workout Financing

We leverage our real estate and insolvency experience to provide loans to clients that are in a formal insolvency process (such as Companies’ Creditors Arrangement Act (CCAA) or Receivership proceedings) or informal turnaround or restructuring situations.

Comprehensive and Custom-Tailored Loans:

• Restructuring or turnaround situations
  • Debt consolidation
  • Tax arrears
  • Shareholder dispute
  • Distressed debt (special loans)
• Estate litigation proceedings or to fund the estate trustee during litigation proceedings
• Receivership (receiver certificates)
• Debtor-in-possession financing (DIP)
• Bankruptcy (trustee certificates) 

Although our alternative financing loans are mainly real estate based, we may consider allowing a higher loan to value on real estate if there are other assets we can leverage against. For instance, we can also loan against the forced liquidation value of equipment.

The earlier we become involved, the more options may be available. Where possible, we encourage clients and their advisors to explore a workout strategy before a lender takes enforcement action. However, we can also provide financing in reactive situations where enforcement has already commenced.

Debtor-in-Possession (DIP) Financing

Formal insolvency proceedings can create an immediate need for new capital. A company may have a viable business, valuable assets, or significant real estate equity, but lack the liquidity required to continue operating during a restructuring.

Hillmount Capital provides debtor-in-possession (DIP) financing to support companies during formal insolvency proceedings, including proceedings under the Companies’ Creditors Arrangement Act (CCAA).

DIP financing can provide the liquidity needed to:

• Maintain operations during the restructuring process
• Fund working capital requirements
• Preserve and enhance the value of assets
• Pay critical operating expenses
• Support a restructuring or sale process
• Stabilize a business while a longer-term solution is developed
• Provide the liquidity required to implement an approved restructuring plan

We understand that DIP financing must work within the broader insolvency process. Our approach is therefore highly collaborative. We work with the borrower, legal counsel, insolvency professionals, existing lenders, and other stakeholders to understand the proposed restructuring and develop financing that supports the overall process.

Our financing is secured by real estate and occasionally other valuable assets, allowing us to consider opportunities that may not fit conventional lending parameters.

Receiver Certificates & Receivership Financing

When a receiver is appointed, access to immediate liquidity can be critical to preserving the value of the assets under administration.

Hillmount Capital provides financing to support receivers during receivership proceedings, including receiver certificate financing.

We can work with court-appointed receivers and their legal advisors to provide capital for real estate matters such as:

• Property operating expenses
• Property preservation and maintenance
• Insurance and property taxes
• Essential repairs and capital expenditures
• Stabilization of income-producing properties
• Carrying costs while assets are marketed for sale
• Costs associated with an orderly disposition
• Other approved expenses necessary to preserve or realize asset value

Receiver certificate financing can provide a receiver with the liquidity needed to maintain and protect an asset while pursuing the best available realization strategy.

Our experience with real estate and distressed situations allows us to evaluate the underlying assets, proposed realization strategy, existing security position, and expected exit. We understand that speed is critical in receivership matters and work to provide a practical financing solution within the requirements of the proceeding.

Financing for Estate Trustees During Litigation

Estate litigation can create a unique liquidity problem. An estate may own substantial real estate or other valuable assets but have limited cash available to fund legal expenses, taxes, carrying costs, or other obligations while litigation is ongoing.

Hillmount Capital provides financing to estate trustees where capital is required during estate litigation proceedings.

Financing may be used to:

• Fund legal and professional fees associated with estate litigation
• Pay property taxes, mortgages, insurance, and other carrying costs
• Preserve and maintain estate assets during litigation
• Provide liquidity where estate assets cannot be readily sold
• Address competing claims or obligations affecting the estate
• Provide the estate with additional time to resolve litigation before selling an asset
• Bridge the estate until litigation is resolved or an asset can be monetized

We recognize that estate litigation can involve multiple beneficiaries, competing interests, court proceedings, and significant delays. Our focus is on understanding the assets of the estate, the nature of the litigation, the estate’s obligations, and the anticipated path to repayment.

Where the estate has sufficient underlying asset value, we provide financing even when traditional lenders are unwilling to lend because of the ongoing litigation.