Real Estate and Finance


Klehr Harrison's dynamic and diverse Real Estate and Finance Practice Group is among the most active in the City of Philadelphia, the tri-state area and nationally. We serve clients with local and regional needs as well as those involved in national and international transactions, including individual investors, national developers, retailers, REITs, private equity funds, CMBS, mezzanine and institutional lenders and special servicers in connection with their real estate needs (a representative sampling of our current clients is provided below).

We routinely handle transactions of varying sizes and degrees of complexity covering disciplines such as financing, leasing, development (including zoning, land use, condominium and planned community work), sale-leasebacks and taxation, sales of mortgage and mezzanine loans, "B-Notes" and participation interests, as well as the disposition and acquisition of all major real estate asset types (e.g., offices, retail, industrial, multi-family housing, hospitality, health-care and mixed use properties). We have a long history of representing borrowers and lenders in connection with loan workouts, restructurings and enforcement matters and, in addition to working out mortgage loans, we have significant experience in the workout and enforcement of remedies with respect to mezzanine loans, preferred equity investments and in advising clients holding "B-Notes" and participation interests in default situations.

We pride ourselves on being responsive and cost-efficient, getting to know our clients' businesses and strategic goals and operating with a national scope while retaining a local touch. Anticipating our clients' needs and avoiding potential pitfalls distinguishes the level of service that we provide.


Related Groups


Distressed Debt, Equity and Lease Subgroup

Environmental Group

Fund Formation and Joint Ventures Group

Government Relations Subgroup

Real Estate Tax Subgroup

Zoning and Land Use Group  

Practice Areas

The Real Estate and Finance Practice Group's practice areas include the following: 

Acquisitions and Dispositions. Real Estate acquisition and disposition transactions of all sizes and levels of complexity are a major part of our real estate practice. Whether the transaction involves a single property or multiple properties in multiple states, and whether the property is undeveloped land, an apartment complex, an office building, a shopping center or a warehouse, we will deftly handle each aspect of the transaction from term sheet to closing.

Commercial Leasing. We routinely negotiate commercial leases and provide general leasing advice for both landlords and tenants across varying property categories, including retail, office and industrial. Our leasing experience includes negotiating space leases, build-to-suit leases, financeable ground leases, subleases, bond type leases, unitary leases, synthetic leases and sale-leaseback transactions. In particular, we have considerable experience with respect to shopping center leasing and are quite familiar with the lease forms and hot button issues for an ever-expanding list of regional, national and international chain store companies and landlords.

Condominium and Planned Communities. Our condominium and planned community practice is broad and deep. We have represented developers and declarants in forming over 30 condominiums and planned communities in the last 5 years, both conversions and ground-up developments. We have prepared manuals for their start-up and operations. The communities include residential, office, retail, industrial and mixed-use. We represent declarants and associations in the turnover of declarant control, the separate assignment of successor declarant rights to third parties and disputes over underfunded and overfunded liabilities. We represent purchasers and sellers of units in amicable sales and in litigation. We represent declarants, associations and mortgagees in communities which have failed to complete development, which have completed development but failed to sell and which have been subject to foreclosure, deeds-in-lieu of foreclosure and similar creditor rights and remedies. We have represented objector unit owners in preventing amendments to declarations.

Construction. Our construction law practice is sophisticated and experienced in negotiating with many of the national contractors for large projects and projects of limited scope where the basis of payment is a stipulated sum or cost of the work plus fee with and without a negotiated guaranteed maximum price. We have represented developers and lenders in construction for core property types and specialized facilities, including residential, multi-family, in-line and stand alone retail, industrial, hospitals and other health facilities, assisted living facilities, schools, restaurants, parking facilities, performance facilities and sewer facilities. Negotiations have encompassed revisions to AIA documents and contractor forms, including agreements for architects, contractors, construction managers, designers/builders, subcontractors, owner representatives and the attendant general conditions. We have two LEED - certified attorneys who work closely with contractors on sustainability issues. Our representations have included bid packages, lien waivers sufficient to qualify for statutory compliance, payment bonds, labor and material bonds, sureties and subcontractor default insurance. Our representations have also included enforcement, termination, replacement of contractors and defense of contractor claims under the respective contracts.

Corporate Real Estate. We have a very deep and seasoned corporate real estate practice. We have developed particular expertise in providing real estate support for private equity firms that acquire companies that have significant real estate assets. In this regard, we have served as real estate counsel for over 100 corporate acquisitions within the last several years. We have established teams of deal lawyers with significant experience and training in diligencing and closing complex multi-property, multi-state and even multi-national transactions. Our lawyers are extremely responsive, efficient and practical in navigating through the most sophisticated transactions.

Finance. We have a dynamic commercial real estate finance practice representing both lenders and borrowers in loan originations and workouts and representing both buyers and sellers in loan purchases and sales. In addition to our regular work for banks and other portfolio lenders, we have closed in excess of $2 billion in loan originations for major CMBS lenders on properties in all major asset classes, located nationwide. Additionally, we represent mezzanine lenders, "B-Note" buyers and co-originators, and preferred equity investors participating at all levels of the capital stack in numerous transactions. Our representation regularly includes the structuring and negotiation of multi-tiered intercreditor, co-lender and participation agreements. Our finance practice is led by seasoned attorneys with considerable experience in loan restructurings and enforcement. Representative restructuring and enforcement transactions include (i) the work-out on behalf of B-Note investor of a $30MM B-Note and securitized $170MM A-Note secured by a portfolio of apartment buildings located in New York City, and (ii) the successful taking back of a portfolio of apartment complexes in Ohio by the mezzanine lender pursuant to a UCC sale. We have at least an equal depth and breadth of experience representing borrowers in financing transactions. Our finance attorneys represent numerous investors, developers, private equity funds and REITs in loan borrowings and restructurings. Our attorneys represent clients in complex mortgage and mezzanine financings acquisitions, refinancings, renovations, ground-up developments and asset repositionings on both a regional and national basis. Transactions include financings and restructurings of major retail malls, office buildings, condominiums, hotels and student housing complexes and financings in connection with mergers and acquisitions.

Health Care Facilities. We have a robust real estate health facilities practice representing university based health systems, religious based health systems, not for profit research facilities, health facility REITs, pharmaceutical companies, for profit merchant builders and similar medical and health care related developers, landlords, tenants, and lenders in the negotiation of acquisition, disposition, construction, finance, lease, workout and foreclosures for hospitals, medical office buildings, clinical office buildings, assisted living facilities, and nursing homes. We are also members of the American Health Lawyers Association.

Real Estate Development. We have extensive experience representing property owners and developers on many types of real estate development projects, including office buildings, planned communities, condominiums, condominium conversions, new construction projects, shopping centers, casinos, hotels, restaurants, research/industrial parks, urban mixed-use and single and multi-family residential projects. We represent clients in all aspects of a development project, including land use entitlements, land acquisition, project financing, design, construction, leasing and sale. We have extensive experience in public private partnerships and assist our clients in obtaining governmental inducements for their development projects such as tax increment financing, federal and state historic tax credit programs and new market tax credits.

Sale-Leasebacks. We have one of the most active and experienced sale-leaseback practices in the country. Over the past 5 years, we have closed over $3 billion of sale-leaseback transactions. We represented the tenant in the largest sale leaseback in U.S. history. We have established teams of deal lawyers with significant experience and training in diligencing and closing complex multi-property, multi-state transactions. We work closely with the major accounting firms and are extremely knowledgeable about the accounting and tax concerns of sale-leaseback transactions. 

Representative Clients

Amerimar Enterprises LEM Capital, LLC
Atalaya Capital Management Lubert-Adler Partners
Black Angus Steakhouses Mattress Firm, Inc.
Blick Art Materials Morgan Properties
Bob's Stores Onyx Equities
Boscov's Department Stores Parkway Corporation
Boston Markets PREIT
Brandywine Realty Trust Retro Fitness
Campus Apartments Rite Aid
Capmark Finance LLC Scully Company
Central Parking Sheetz, Inc.
Clear Channel Outdoor Sisters of Mercy
Dick Blick Holdings, Inc. Sovereign Bank
DDR Corp. Starbucks
Five Below Starr Restaurants
Friendly's Sun Capital Partners
Gamestop Susquehanna Bank
Goldman Properties The Goldenberg Group
Grasso Holdings Thomas Jefferson University
Heritage Senior Living Tishman Realty Corporation
Interpark Inc. Toll Brothers
Keystone Property Group Tower Investments
Kimmel Center Urban Growth Property Trust
Korman Communities Universal Health Services
LA Fitness     Versa Capital Management
 (Fitness International) Westover Companies

Representative Transactions

Our Real Estate and Finance Practice Group is as diverse geographically as our clients' real estate portfolios dictate. A short list of significant or typical recent transactions follow: 

  • Representation of national hospital operator/investor as real estate, zoning, employment and environmental counsel in the acquisition of two hospital campuses, including six medical office buildings, and two accessory parking facilities, subject to approximately 200,000 square feet of on-campus credit tenant leases to a medical school and 22 off-campus satellite leases; financed through an equity joint venture’ master leasing premises in conjunction with purchase money mortgage financing and a revolving line of credit.
  • Representation of a national private investment firm in the acquisition of a 350-department store chain located primarily in the Midwest.
  • Representation of a national private investment firm as real estate counsel in the sale-leaseback of 178 department stores. As reported in a front-page article in The Wall Street Journal, the $815.3 million deal was the largest retail sale-leaseback in U.S. history.
  • Representation of the largest privately-held student housing developer in the U.S. in the acquisition and redevelopment of student housing properties, including a strategic joint venture with a prominent university.
  • Representation of a mezzanine lender in the take-over of control of ground-leased, multi-family property located in Florida and the conduct of the subsequent UCC-sale, including advice and representation as to the senior mortgage lender and other property level lien holders.
  • Representation of one of the largest real estate opportunity funds in the country in a variety of matters, including the acquisition of a 270-department store chain and the acquisition and redevelopment of numerous office and apartment buildings.
  • Representation of the largest retail power center developer in the Delaware Valley in connection with the acquisition, development, leasing and financing of (i) a 600,000 sq. ft. retail shopping center located in Center City, Philadelphia, anchored by IKEA, Lowe's, and other national retail tenants, and (ii) a 500,000 sq. ft. retail shopping center located in Northeast Philadelphia anchored by Wal-Mart, Lowe's and other national retail tenants.
  • Representation of a major CMBS lender in the origination of senior and mezzanine loans aggregating $116,875,000 for the financing of the acquisition (pursuant to a so-called 89/11 transaction) of a landmark Center City, Philadelphia, office building.
  • Representation of a mezzanine investment fund in its whole loan acquisition of a mezzanine loan secured by 5 hotel properties located over 4 states.
  • Representation of a merchant power plant developer in connection with a $1.8 billion facility, including the acquisition of a coal company with potential coal extraction over a 30-year mining plan, the acquisition and development of a not-for-profit acid mine dewatering and clarification plant and the acquisition and development of a river port for the development of intermodal capacity.
  • Representation of a global holding company and subsidiary operating company for the construction of a 1,000,000 sq. ft. office park and leases of over 1,000,000 sq. ft. of research, office, manufacturing and warehouse space in Alabama, Illinois, New Jersey and Pennsylvania in excess of $100,000,000.
  • Representation of a super-regional health system in one of the first outpatient hospitals in a retail shopping center.
  • Representation of the joint venture that acquired Central Parking Corporation, the largest parking operator in Philadelphia, in a $1 billion transaction.
  • Representation of a large private equity investment firm in the $325 million acquisition of a large Midwest supermarket chain operating 116 supermarkets and 154 convenience stores.

Mezzanine and Preferred Equity Transactions

Regularly represent lenders and investors originating and purchasing mezzanine loans and preferred equity investments. Listed below are some representative mezzanine and preferred equity transactions:

  • $4.5MM preferred equity investment, representing 80% of the equity in the acquisition of a garden style multi-family apartment complex in Florida. Total transaction value of $20MM.
  • $3.5MM preferred equity investment, representing 85% of the equity in the acquisition of a garden style multi-family apartment complex in California. Total transaction value of $10MM.
  • Origination of $2.5MM mezzanine loan which was originated contemporaneously with a $33.5MM mortgage loan. We represented the mezzanine lender. The purpose of the loan was to acquire and renovate a regional shopping center located in Northeastern Ohio.
  • Origination of $14.1MM mezzanine loan and $105MM mortgage loan to finance the acquisition of a major office building in Philadelphia, PA. We represented the lender of both loans.
  • Acquisition of $20MM third mezzanine loan. Loan was behind $212MM of mortgage and senior mezzanine debt. The debt financed the acquisition of a hotel in New York, NY. We represented the loan purchaser.
  • Acquisition of three mezzanine loans aggregating approximately $2MM. Each of the loans was secured by pledges of the equity in a portfolio of properties that were triple net leased to Walgreens. Aggregate mortgage financing per each portfolio varied, but was in the $10MM range. We represented the loan purchaser.