Avison Young’s CEO, Mark E. Rose, recently spoke with Connect CRE about the company’s proactive approach to restructuring its debt in light of the Federal Reserve and other central banks’ hawkish stance on interest rates. The move was made fifteen months ago when Avison Young recognized that this trend would have a significant impact on commercial real estate transaction volume.
According to Rose, waiting for external factors to dictate their actions was not an option. Instead, they took charge by initiating talks with investors and presenting a strategic plan for reducing financial obligations while securing additional capital for future growth.
The successful completion of this transaction without any court involvement or downsizing is a testament to Avison Young’s strong management team and sound strategy. This also allowed them to acquire Madison Marquette’s retail division earlier this year.
While S&P downgraded Avison Young due to missed interest payments on paper (which were not actually required under the restructuring agreement), it is expected that their rating will improve following the completion of the deal.
Rose emphasized that taking proactive measures requires trust from stakeholders in management and confidence in their direction as a company. He also pointed out that such negotiations would not be possible if there were financial distress involved.
In conclusion, Avison Young has successfully navigated through these challenges by being proactive rather than reactive – something which has positioned them well for future success.
