Solutions to mitigate interest rate volatility
Whether it’s a real estate project or a portfolio of properties, there are inevitable questions about how to protect against changes in interest rates. What should be your fixed vs. floating debt ratio? Is there a lender-required cap or swap? What is your refinance risk? What about fair ISDA terms and derivatives regulation like Dodd-Frank?
Chatham Financial has the right answers for real estate investors. We are an independent firm specializing in capital markets and trading expertise. Our services are designed to reduce burdens on resources, save time, and bring transparency to complex transactions.
How Chatham helps reduce interest rate risk
Tailored risk assessment and analysis: Chatham Financial has helped manage interest rate risk for real estate investors for over 20 years. Each solution involves analyzing the underlying exposure and evaluating hedging alternatives. Whether your hedging is lender-required or elective, we can provide real time market insight and best practices for your financial risk management.
Comprehensive execution process: Expert consultants, proprietary models, and in-house technology applications all feed into Chatham’s market-tested processes. Our clients have come to expect a holistic working relationship with us, including:
- Effective hedging strategy. We evaluate interest rate risk and determine appropriate structures, taking into account relevant economic, regulatory, and accounting factors.
- Vetted counterparty pool. We assemble banks and establish trading lines to create a competitive and effective group to leverage when executing transactions.
- Full service transaction preparation. We arrange and execute transactions through competitive auction or negotiation.
- Comprehensive reporting and administration. We provide recordkeeping and reporting as well as documentation assistance for legal and compliance (such as Dodd-Frank).
Fully scaled hedge accounting practice: If you have reporting obligations as an SEC filing company, Chatham’s expertise ranges from risk management strategy to transparent reporting, with best-in-class hedge accounting and debt and derivatives valuation practices. We also offer industry-leading regulatory compliance advisory.
Our expertise in ASC 815 and IAS 39 standards enables us to advise on optimal economic hedging structures that can receive the most favorable hedge accounting treatments, thereby reducing or eliminating earnings volatility. Our processes and methodologies are respected by auditors and regulators alike.
How companies work with Chatham
Chatham’s expert advisors are available to work with you one-on-one to fully discuss the impacts of a desired hedging strategy as well as weigh the alternatives for effectively managing your financial risk. Our fee structures are clear; the meter isn’t running every time you pick up the phone to ask about an indication or seek guidance on topics like prepayment implications or regulatory compliance.