Interview: Jasmine Tzeng
Jasmine Tzeng
|
Posted Saturday, May 15, 2021

Jasmine currently works as a Senior Associate for Orrick, Herrington & Sutcliffe LLP. She advises institutional investors in all phases of real property investment, including development, secured financing, and acquisitions and dispositions of real estate portfolios. Prior to her work at Orrick, Jasmine worked on commercial real estate matters at Downey Brand. When Jasmine was a student at King Hall, she was involved in the King Hall Negotiations Team, Moot Court Board, Journal of International Law, and Business Law Journal.

 

 

I noticed you were involved in some of the more traditional litigation oriented internships and clerkships when you were a student, what made you want to be a transactional attorney instead?

You know, I honestly just didn’t know what it meant to practice transactional law in law school. I didn’t know that was an option. I did moot court and mock trial in law school, so in my mind the career options were purely litigation focused. But as a first year associate, I had the option of splitting my time between litigation and transactional work, and that was the first time that I was exposed to transactional work and I loved it. Most of my friends are in litigation and they love it, too. I’m not a fan of conflict and prefer the more proactive and collaborative nature of closing a deal in a transaction. I also love organization and detail, which is critical in transactional work. The cool thing about real estate in particular is that every property is unique. Depending on the asset (could be a hotel, residential property, a commercial property, mixed-use, etc.), it completely changes the negotiating position you might be in, which ultimately affects how you structure the deal.


Can you walk us through the main stages of a big real estate transaction?

The life-cycle of a real estate deal depends on the transaction and who you’re representing, but usually the birth of a deal is the term sheet.

In the term sheet stage, your client and the other party will agree on major business terms: the price of the sale or purchase of an asset, the amount of financing, terms of a bad boy guaranty, any environmental insurances and indemnity, or other deal specific terms, etc. Term sheets are usually non-binding, but it's essentially the hand-shake equivalent of what’s going to happen. After term sheets are agreed to, counsel starts drafting the various documents necessary for the transaction. If you’re the seller, the seller’s counsel usually takes the lead on drafting the documents. If you’re a lender, usually the lender’s counsel takes the lead on drafting the financing documents. Some documents come directly from third parties, such as subordination and non-disturbance agreements from hotel operators or lenders, comfort letters from franchisors, or estoppels from negotiated leases for retail tenants, legal opinions from special counsel, to name a few - this overlaps with due diligence as well.

Then you’re negotiating the terms on the documents. Also at the same time there's diligence going on. If you’re buying property, for example, you as the buyer want to know whether there are any environmental issues, survey encroachments, zoning issues, access issues, existing lien filings, bankruptcies, issues with the special purpose entities, etc. We typically review title reports, third party reports and organizational documents as part of our due diligence. If there are tenants in an office space, for example, you may need to obtain estoppel certificates or subordination and non-disturbance agreements. This is all part of the due diligence phase.

As you approach the closing, which is the consummation of the entire transaction, you finalize negotiations and the various transaction documents. Closing of escrow is typically when documents are finalized and signature pages are attached and released, the parties have authorized the closing, money has been funded to the appropriate parties and/or any documents to be recorded or filed are submitted for such recordation or filing by title or escrow.

Post-closing, if there are outstanding items that weren’t able to be completed on the closing date, that is when the parties finalize those items or tasks. These might be memorialized in a post-closing letter or agreement. We typically prepare physical and electronic closing sets or binders for our clients and for our records as well. 


I noticed many of your transactions are in locations across the United States. Does your work require you to travel often?

No, actually! A lot of the due diligence that would require travel, like site inspections, are either conducted by our clients or for environmental assessments and reports, done by third party vendors. We do, however, often have industry conferences or events that we are able to travel to, or for local clients, we are able to have closing dinners to celebrate a closing (pre-pandemic). 


I noticed you were involved in negotiating franchise and management agreements for some of your hospitality transactions.  How involved are typically involved in the negotiation process for these types of transactions?

As counsel on a hospitality transaction, you’re the one negotiating with major brands or managers and their counsel on the conversation. You’re also raising potential issues unique to the property based on your due diligence and alerting your client on potential risks so that they can make an educated business decision.


How have your responsibilities changed from when you were a junior associate to now?

I’d say the more senior you become as an associate, the more you’re able to lead or run a deal, and have more direct communications with the client. As a junior associate, at least at Orrick, we do try to give them as much exposure as we can early on, such as running a checklist for the transaction, drafting documents and reviewing due diligence so they can learn about the nuances. There is always a more senior associate and partner also staffed on a deal that would of course supervise and review the work. 


Has practicing real estate law changed in any major ways from when you started? Whether through technology or otherwise?

Before the pandemic, it was a lot more focused on transactions such as purchase and sales, financings, etc. that moved on shorter deadlines. With economic uncertainty following the pandemic, we saw more of a shift towards renegotiating existing deals, cross-practice work with bankruptcy and restructuring, and some distressed debt - basically seeing the other end of the cycle when things aren’t going smoothly in a deal. At the same time we’re seeing opportunities to step into distressed debt.

Technology wise, people are finding ways to streamline the due diligence process and to make things more efficient. For example, there are options now of surveying a property with drones rather than in person, or during the pandemic, parties often closed over electronic signatures or PDFs rather than wet ink originals. 


What were some of the biggest challenges you’ve had to overcome in your career thus far?

My biggest challenge was that there was so much in the practice of law that law school doesn’t prepare you for. There are so many things that you just have to learn and develop with time and experience. Sometimes I get impatient because I want to know those things right away. But as you get more experience drafting and negotiating documents and understanding the industry and market, you get a better sense of the clients’ objectives and goals and how to better achieve results for them.

Early on I would try to seek opportunities to work on different types of deals to not only understand the different styles of the parties and senior associates I worked with, but also what our clients valued. As a junior you’re very focused on the details of whatever task you’re given at hand, but it’s important, like we were talking about earlier, to take a step back, clarify things, and understand the big picture.

It’s helpful to have that mindset in law school, too. Always keep things in perspective.


What experience at King Hall most prepared you for what you do now?

I think the experience that came the closest to what I do now was the transactional competition when I was in KHNT, but nowadays we rarely negotiate or close transactions in person. Most of our negotiations are via conference calls, trading redrafts of the documents or through email, but it was still good exposure to the thought process involved in discussing terms in a deal sheet, sitting down with the other party, and reaching a solution to bring back to your client.


Any advice to junior associates?

I appreciate when junior associates first try to brainstorm solutions to a problem before asking their questions right away, and present those solutions as options. Even if the proposed solutions aren’t correct, it shows they are critically thinking things through and value more senior associates’ or partners’ time. That being said, don’t be afraid to ask if you don’t know something or spend too much time spinning your wheels. Chances are senior attorneys are more than happy to answer questions and help you learn, and often will bring up things you didn’t think about!