Single-name Distressed Real-Estate Restructuring

• Create a compliant mechanism to support a specific borrower without breaching the prohibition on inter-borrower income transfers.

• Maintain pool integrity while enabling targeted balance-sheet support.

• Deploy available capital within clearly defined risk parameters.

• 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-collateralization 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 $300M 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.

This engagement with Willow Brook Capital demonstrates Polymath & Boffin’s ability to engineer controlled, regulation-aware solutions for complex single-name restructurings within pooled real-estate credit.