How are commercial real estate investors adapting their acquisition strategies during the COVID-19 crisis?

In this episode, Veena Jetti discusses how the COVID-19 pandemic is impacting commercial real estate acquisition deals. She provides insight into changes being made to typical PSAs, strategies for pricing assets and securing favorable financing terms in the current climate of uncertainty, and how experienced investors can structure deals to withstand market volatility.

Veena Jetti is the Founding Partner of Vive Funds, a unique commercial real estate firm that specializes in curating conservative opportunities for investors. She has over a decade of real estate experience including overseeing the management of $1B+ in real estate assets. Her expertise includes driving corporate growth strategy, asset management, and business development derived from working for multiple Fortune 500 companies. Veena is also a Forbes Councils Member

[00:00:00 - 00:03:00]: The Challenges of Due Diligence During COVID-19

• Cannot safely access units to conduct full due diligence
• Recommend negotiating extended or flexible due diligence periods in PSAs
• Consider adding post-close holdbacks to cover unforeseen issues

[00:03:00 - 00:05:00]: The Role of Non-Refundable Earnest Money Deposits

• Shows seller you are a serious, competitive buyer
• Likely to still be required for high value deals
• Helps set strong buyers apart

00:05:00 - 00:07:00]: Pricing Stabilized Assets Heading Into Distress

• Too much uncertainty to accurately predict market direction
• Focus on principal protection over high returns
• Stress test for higher vacancy and no rent growth

[00:07:00 - 00:10:00]: The Pitfalls of Short-Term Bridge Loans

• Popular recently to maximize leverage
• Risky if unable to refinance in downturn
• Best for unstabilized assets or when long-term debt unfeasible

[00:10:00 - 00:16:00]: Securing Long-Term, Flexible Financing

• Focus on 10-year commercial loans, not private debt
• Withstand holding property through downturns
• Bridge loans still useful in some cases

Quotes:

"We never throw good money after bad money." - Veena Jetti:

We basically will never go for the home run. We're always going for like that solid double." - Veena Jetti: "

Connect with Veena:

https://www.linkedin.com/in/veenajetti/

https://vivefunds.com/

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