“You live in a movie, Dad,” my daughter tells me as we watch together and I predict what will happen in the next step of the successful American series Suits, which recently crossed the threshold of three billion weekly viewing hours for seven consecutive weeks.
Slowly she understands that the plot “develops” outside the safe harbor, when people decide to rely on luck, take a “calculated” risk and expect it will be okay...
Recently a hot deal rolled my way from a receiver: a boutique hotel on the island of Zanzibar at a very attractive price. After verifying the data, cross-checking information, a Zoom call with the receiver and putting together a document of the main terms of the deal, I send a confidential email to my list of 41 investors with the offer.
All members of the list know that emails arriving from this address are hot, attractive, and first come first served. Whoever is rarely available by email may miss hot investment opportunities...
This time one of the active clients responded to the email, a boutique real estate developer handled on several projects by the firm, and announced: the hotel deal interests me, let's move it forward.
Are you sure? I asked. Your focus is on locating, buying, planning value-add, renovating and selling. Why get into an operational deal in a field where you have no experience?
The client shared that his wife's dream is a hotel in her name in Zanzibar, and that on their honeymoon on the island 17 years ago he promised her that her dream would come true.
We went over the details of the deal and I began representing my client in a new transaction.
After another update call and receiving initial documents, we set up a joint Zoom call with the temporary liquidator. The conversation flowed and the client proposed his outline for purchasing the hotel. After some ping-pong between him and the liquidator they reached understandings, and I asked to see a few more documents before we submitted a formal written offer to the court.
Since the company that owns the hotel does not own the land, I asked to see the lease agreement. The agreement was delayed, and every day the client called and asked me to send the liquidator the written offer already.
Why are you in such a hurry? I asked.
In two weeks my wife and I will celebrate our 18th wedding anniversary and I want to give her the hotel as a gift.
The client has our wish, while the liquidator has his own pace of work...
Friday, 3 p.m., and I'm absorbed in my office preparing a capital-raising presentation ahead of a trip to a meeting at the lending bank in Romania for a residential project, when I hear a knock at the door.
My client had arrived about the hotel in Zanzibar and actually scolded me at the office door for dissolving his deal and, because of me, he would lose the opportunity to fulfill his wife's dream.
We went into the office and sat, and I explained that I wanted to see the cancellation terms of the lease before we sent the offer, because of the risk that he would win the hotel but not be able to realize the win because of the landowner.
“Yes, but I'm buying from the liquidator,” he repeated his claim. “I'm supposed to get it free of debts.”
I repeated my explanation and we agreed that I would respect his decision to act contrary to my recommendation, after he instructed me to do so in a reply email to the email in which I had detailed the risks to him.
We continued to apply pressure on the temporary liquidator, and after another week the lease agreement arrived.
“Do you understand what is written in the agreement?” I asked him.
The agreement included a clause under which the landowner has the right to cancel the agreement if the lease payments are not paid on time (and in this case they had not been paid for more than a year). “I insist that the offer include a commitment by the liquidator to obtain the owner's consent to the continuation of the lease agreement,” I said.
That same day the offer was submitted with the clause I drafted on continuation of the lease.
A week later I received a phone call from the temporary liquidator - the landowner was unwilling to commit to continuing the lease agreement. I made clear to the liquidator that for us this is a “Deal breaker” and that without the consent we would withdraw our offer.
And the client went to Zanzibar to celebrate an anniversary with his wife.
Not before texting me: “Thanks for protecting me in the deal. I'm not giving up, find me a hotel in Zanzibar.”
In this deal too, the white hairs proved that professional experience, intuition and loyalty to the truth are my compass. Shortcuts and luck are meant to generate ratings on Netflix.
Stories are based on real situations, with identifying details changed. Not legal advice.
Translated from the Hebrew original. עברית