Single-Name Distressed Real-Estate Restructuring

Swap-equity solution. P&B developed a swap equity approach as a regulated correction methodology to revenues, enabling support to one specific borrower while respecting the no-transfer rule on income streams. 

Rule-based eligibility. The system required strict conditions to be met, including assessments of security, collateral, value, type and liquidity of collateral, types and timing of revenue streams, and value-to-transaction costs. 

Cross-collateral acceptance. Participating single-name portfolios accepted cross-collateralisation with other borrowers; if one defaulted, it would grant equity proportionately to the contributing borrowers in the group. 

Targeted borrower support delivered via the swap-equity mechanism without using other borrowers’ income. 

Defined protections for participants through condition-driven eligibility and cross-collateral terms. 

Capital availability P&B had $300 million available between 2017 and 2019, which was fully deployed into single-name portfolios operating under these agreed cross-collateral arrangements. 

Compliant design. The structure addresses pool constraints on income sharing while allowing borrower-specific remediation. 

Aligned incentives. Pro-rata equity grants upon default create reciprocal protection among contributing borrowers. 

Disciplined deployment. A rules-based framework—centered on collateral quality, revenue characteristics and cost-to-value—guided capital allocation across single-name exposures.