Experts in CRE debt and derivatives valuation

Determining the accurate, fair value of commercial real estate loan debt or applied derivative instruments may seem simple on the surface. Nonetheless, improper measurements can lead to significant, long-term financial loss over the course of the loan or derivative. It may also prompt questions from investors, auditors, and regulators.

How Chatham’s valuation services help real estate clients

Independent third-party expertise: Chatham has been working with real estate companies for over 20 years, using proprietary models and independently gathered data to value debt and derivatives. And our advisors are in the markets every day, continually building market knowledge, monitoring trends, and adjusting for changing standards.

From caps, swaps, and FX forwards, through to more exotic derivatives, Chatham offers a robust platform that provides clients with real-time values via our secure website. Our best-in-class valuation models have been tested and reviewed by auditors from the leading accounting firms, providing a thorough calculation of nonperformance risk for clients needing ASC 820 or IFRS 13 fair values.

Market-tested methodology: We provide an independent valuation source for clients as they enter term loans and derivative contracts ensuring our clients have a fully transparent view of the debt over time and of their derivatives from inception through to maturity. Chatham executes more than $350 billion of notional executed every year on behalf of our clients, bringing deep knowledge of the markets and direct experience in debt valuation and pricing derivative transactions into the development of our core valuation models which are honed and refined by our in-house team of quantitative experts. Our models are subjected to rigorous SSAE16 audits every year, providing clients with assurance that we employ validated methodologies and reliable controls.

Accounting compliant: Our derivative valuation services are fully integrated with our ASC 815 and IAS39 accounting engines to provide journal entries and effectiveness tests. This results in a seamless solution for accounting-sensitive clients. As a leader on the cutting edge of valuations, Chatham incorporates CVA-DVA-FVA and OIS discounting into valuation methodologies. We can also support clients with experts to help explain these concepts or answer questions raised by management, auditors, or other constituents.

How companies work with Chatham

Whether you need to satisfy investor or auditor requests, prepare for M&A or IPO, or look at implications of debt refinancing, our debt and derivative valuation services help clients understand the fair value of their debt liabilities and assets. As a one-time analysis project or ongoing monthly or quarterly fully scoped retainer, Chatham works to provide the right level of valuation service for clients.

To learn more about Chatham Financial’s Debt and Derivative Valuation Services, please contact us today.