Understanding Value and Exit Strategy: Lenders Turn to Loeb for their Expertise in Asset Valuation and Asset Recovery
As published in The Secured Lender, October 2010
The key to eliminating the risks associated with asset based lending in the industrial marketplace is to build relationships with companies involved in the buying and selling of those assets. A partner with established knowledge, experience and history in industrial equipment can prove invaluable to mitigating issues with asset valuation and recovery.
For five generations since 1880, Loeb has established itself as a trusted provider of equipment and related services that help manufacturing and financial companies leverage their businesses with expertise in the food, pharmaceutical, cosmetics and chemical industries. The company provides: equipment sales and purchases, certified market appraisals from Loeb Appraisal, liquidation and auction services from its subsidiary Loeb Winternitz Industrial Auctioneers, and purchase lease back financing from its affiliate, Loeb Financial Services.
In the early 1970's, during the start of asset based lending, financial institutions were relying on insurance appraisals and mathematical formulas to calculate the value of the equipment they were lending against. It didn't take long for those lenders to realize that some of the values were not at market rate when they were unable to recover the assets predicted value. Heller Financial first approached Loeb to review their industrial lending opportunities and through this partnership Loeb's appraisal division was established.
Today, Loeb Appraisal continues to perform certified appraisals for manufacturers and lenders of all types. This division of Loeb is comprised of accomplished and credentialed professionals with certifications from the Association of Machinery and Equipment Appraisers (CEA), Equipment Appraisers Association of North America (CSA) and all appraisals are USPAP compliant.
In addition to the appraisal values they determine in the field, Loeb has proprietary software, allowing them to gain valuable insight based on the analysis of their own equipment sales and auction sales cycle. This lends practical data to the analysis of market and equipment trends to provide true market valuations of surplus equipment.
In certain cases, banks and lenders turn to Loeb to assist in asset recovery strategies ranging from cash buyout of the assets to auction and liquidation coordination. Loeb's subsidiary, Loeb Winternitz Industrial Auctioneers oversees the entire process, including:
- Asset Valuation with Guarantees
- Auction Communications
- On-Site and Online Auction Services
- Complete Liquidation Services from Complete Facilities to Single Machines
"Our experiences afford us the ability to determine in advance what the outcome of our clients goals will be, establish a timetable to achieve them, and even offer alternatives that can maximize value and shorten timetables. Our success rates speak for itself," states Howard Newman, president. "Recent efforts have resulted in hammer totals averaging at 112% of the estimated recoverable value largely in part to our ability to effectively market the equipment to the right customers."
Loeb maintains an extensive customer database with the ability to pin point and target market segments specific to industry and previous attendance at other auctions or liquidations, making them able to provide aggressive marketing efforts both online and off.
When banks and lenders look to offer alternative financing for their customers unable to qualify under conventional terms, they often turn to Loeb Financial Services LLC. This affiliate of Loeb offers purchase lease back financing programs structured to focus on the asset value and not the credit scores, debt ratios, time in business or cash flow of the company. Each opportunity is evaluated on an individual basis and custom-tailored to meet our customer's unique needs.
No matter your needs as a lender, partnering with an industry expert such as Loeb will prove invaluable in securing your assets for the long run.