Return to Lender: Week of Oct. 8, 2026

An office building near Capital One Arena in Washington, DC has changed hands in a deed in lieu of foreclosure after a distressed loan on the building sold, the Washington Business Journal reported. An affiliate of a joint venture between DC’s Assembly Real Estate LLC and London investment firm FitzWalter Capital Ltd. acquired the 305,759-square-foot office at 700 Sixth St. NW from an affiliate in the care of Affinius Capital LLC⁠. The JV acquired the $140-million debt on the property for $79.5 million.

Morningstar Credit reported that 70 Broad St. ($14.1 million | 9.0% of WFCM 2015-NXS2 | CMBX.9) has been sold for $9.4 million. The loan, backed by mixed-use office/residential building in New York’s Financial District, has been in special servicing since March 2020 and has been completely vacant for years. The reported sale price falls far short of the $15.6 million appraised value reported earlier this year.

The former Everett, WA offices of Frontier Communications and The Everett Herald could be converted into housing as it moves through receivership proceedings, according to the Puget Sound Business Journal. After owners of the 15-acre office property, located just off Interstate 5 at 1800 41st St., defaulted on a $28-million CMBS loan, special servicer Rialto Capital foreclosed on the property in March 2025. The site is now being considered for a potential “medium-to-high density residential” redevelopment project.

The South Florida Business Journal reported that the Pembroke Lakes Mall in Pembroke Pines has been named in a $260-million foreclosure lawsuit and could be placed into receivership. Deutsche Bank, acting on behalf of a CMBS trust, filed a foreclosure lawsuit Sept. 30 against Pembroke Lakes Mall LLC concerning the 748,818-square-foot mall at 11701 Pines Blvd. The CMBS loan was issued for $260 million in 2013, when the mall was appraised at $427 million, CMBS data from Bloomberg show. This past April, the property was appraised at $112 million, meaning the loan is severely underwater.

A judge has approved the receivership sale of the Southridge Mall ($100.9 million | JPMBB 2013-C14 & JPMBB 2013-C12 | CMBX.7), reported Morningstar Credit, citing the Milwaukee Business Journal. The loan is backed by a 571,000-square-foot portion of a regional mall totaling 1.2 million square feet in the Milwaukee suburb of Greendale, WI. It moved to special servicing during the pandemic and has stayed there without a resolution until now.

A Johnson County, KS judge cleared the way for a bank to foreclose on the long-stalled Mission Gateway property after months of delay in the lawsuit between developer Aryeh Realty LLC and lender Metropolitan Commercial Bank, according to the Kansas City Business Journal. District Court Judge Robert Wonnell’s final judgment means New York-based Metropolitan Commercial Bank can start foreclosure on the former Mission Mall site at the southwest corner of Johnson Drive and Roe Avenue in Mission, KS, after Aryeh defaulted on a $26-million loan tied to Mission Gateway.

St. Luke’s Office ($43.4 million | JPMCC 2017-JP7 & CSAIL 2017-C8 | CMBX.11) moved to special servicing following the departure of Intel earlier this year, Morningstar Credit reported. Intel was the second-largest tenant by space (24% of the NRA) and accounted for 32.5% of the underwritten base rent. The loan is secured by a 567,000-square-foot office building in Allentown, PA. It had otherwise remained current through the loan term with net cash flow consistently outpacing the underwritten level.

The Wymore 360 ($33.0M | 3.3% of BMO 2024-5C8 | CMBX.18) moved to special servicing after several months of delinquency and a payment default, according to Morningstar Credit. The loan is secured by a 200-unit multifamily property in Altamonte Springs, FL. Net cash flow has generally been below breakeven despite maintaining occupancy that has surpassed 90%. It’s unclear what has caused the delinquency.

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About Paul Bubny

Paul Bubny serves as Senior Content Director for Connect Commercial Real Estate, a role to which he brings 16-plus years’ experience covering the commercial real estate industry and 30-plus years in business-to-business journalism. In this capacity, he oversees daily operations while also reporting on both local/regional markets and national trends, covering individual transactions across all property types, as well as delving into broader subject matter. He produces 7-10 daily news stories per day and works with the Connect team and clients to develop longer-form content, ranging from Q&As to thought-leadership pieces. Prior to joining Connect, Paul was Managing Editor for both Real Estate Forum and GlobeSt.com at American Lawyer Media, where he oversaw operations at both publications while also producing daily news and feature-length articles. His tenure in B2B publishing stretches back into the print era, and he has served as Editor in Chief on four national trade publications. Since 1999, Paul has volunteered as the newsletter editor of passenger rail advocacy groups (one national, one local).

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