The Investor Scenario & Opportunity
A commercial real estate sponsor secured a two-story street-level commercial property along the H Street NE corridor in Washington, DC. Located along a heavy foot-traffic transit line near Union Station, the asset occupied a prime urban retail location.
The property was acquired through a bankruptcy court auction. Winning the bid allowed the sponsor to lock in a purchase price of $650,000, well below sub-market valuations for commercial real estate in North East DC. However, the court order mandated a non-negotiable five business day funding window to complete the sale and satisfy creditor claims.
The Strategy & Capital Requirement
The primary challenge was securing immediate debt capital to meet the court deadline. Missing the five-day closing timeline would result in default, forfeiture of the earnest money deposit, and loss of the asset to a secondary bidder.
Furthermore, the sponsor required a loan structure that funded 100% of the commercial renovation budget. This permitted the investment group to retain operational cash flow for leasing brokerage commissions and holding reserves across their existing commercial portfolio.
The Henry Solution (Loan Mechanics & Underwriting)
Hard Money Henry underwrote the transaction based on underlying commercial land value and local square-footage sales comparables. Our underwriting team verified recent commercial transactions along H Street within 24 hours, bypassing the delays associated with third-party commercial appraisals.
We issued a firm commitment letter and structured a $765,024 total loan facility. This covered 90% of the purchase price ($585,000) and 100% of the commercial renovation scope ($180,024). Construction capital was escrowed and disbursed across structured draw inspections as work was completed. The loan funded and closed in five business days, meeting the bankruptcy court deadline.
The Financial Win & Outcome
The sponsor executed a 90-day commercial renovation program. The core value-add strategy focused on a structural storefront modernization and interior tenant build-out. Work included replacing outdated exterior brickwork with floor-to-ceiling glass commercial display windows, white-boxing two ground-floor retail spaces, and upgrading upper-floor executive office suites with modern lighting and ADA-compliant restrooms.
The updated building attracted immediate interest from a regional retail operator, resulting in a successful sale to an owner-user upon completion of the work.
- Purchase Price: $650,000
- Rehab Budget: $180,024 (Storefront glass, white-box build-out, ADA restrooms)
- Financing & Holding Costs: $45,000
- Selling Costs (6%): $69,000
- Total Cost Basis & Expenses: $944,024
- Final Sale Price: $1,150,000
- Net Profit: $205,976
Key Takeaways for Local Investors
- Auction acquisitions demand immediate execution. Securing bankruptcy court deals requires partnering with direct lenders who deliver capital in five business days without third-party delays.
- Storefront modernizations unlock commercial equity. Replacing outdated facades with high-visibility glass increases retail foot traffic appeal and commands top-tier sub-market valuations.
- 100% rehab escrow financing preserves sponsor liquidity. Structuring capital to cover the full renovation scope allows commercial investors to maintain cash reserves for leasing and marketing.
Seeking fast capital for a commercial acquisition or tenant build-out in Washington, DC? Submit your property address at hardmoneyhenry.com/apply for a 24-hour commitment letter.
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