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Return to Lender: Week of June 27, 2024
- Brookfield Asset Management has taken title to a 290,835-square-foot office property at 1200 New Hampshire Ave. NW in Washington, DC, through a deed-in-lieu of foreclosure, reported Trepp. The property was owned by BGO, the former BentallGreenOak, which had purchased it in 2018 for $174.5 million. BGO funded its acquisition with $123 million of financing from Citigroup. That loan, whose most recent balance was $70.8 million, was sold to Brookfield last April.
- A $243-million loan on a downtown DC office building was transferred to special servicing earlier this month after a federal agency anchor tenant announced plans to vacate, reported the Washington Business Journal. The loan for Beacon Capital Partners’ property at 1120 20th St. NW, known as Lafayette Centre, was shifted to Miami-based Rialto Capital Advisors for “imminent monetary default,” according to a note shared with bondholders. The special servicer will be charged with working out a resolution to the debt issue between Beacon and investors. The news comes two months after the General Services Administration announced that the Commodity Futures Trading Commission would relocate and downsize from 3 Lafayette Centre.
- Shipt Tower, the tallest building in Birmingham, AL, has entered receivership amid falling occupancy and revenue needed to cover loan requirements, reported the Birmingham Business Journal, citing recent financial filings. HPT Sunbelt Portfolio LLC, a subsidiary of Hertz Investment Group (HIG), bought the Shipt Tower (formerly the Wells Fargo Tower) for $75.98 million and another four office buildings at Inverness Center for $53.4 million in 2015. The $146 million in mortgage debt used to finance those deals was originated by JPMorgan Chase and was subsequently sold to CMBS trusts that same year, according to loan servicer reports. The loans also include the Meridian Building in Columbia, SC, acquired by HIG for $66 million in 2015.
- The San Francisco Business Times reported that lenders are moving to foreclose on a piece of 1155 Market St. after the building’s largest tenant, the City and County of San Francisco, signaled it would depart its longtime offices there. Loan trustee Wilmington Trust filed a lawsuit June 17 alleging The LightHouse Building LLC defaulted on a $48-million loan backed by the lower eight floors of the 11-story 1155 Market. Wilmington, acting on behalf of the building’s lenders, requested the court initiate the judicial foreclosure process and place the building into the care of a receiver.
- An affiliate of Douglas Development Corp. plans to hand over the deed to several prominently located office-and-retail properties in Washington, DC’s Chinatown neighborhood after losing a handful of tenants, including a coworking concept Douglas itself launched to replace a WeWork location that closed there in 2020, according to the Washington Business Journal. Its lender on the properties at 704-718 Seventh St. NW filed a complaint in DC Superior Court in late March, and plans to foreclose on the four-building, 48,083-square-foot assemblage, though doesn’t appear to have initiated foreclosure proceedings yet.
- The Cleveland East Portfolio ($39.2 million | CD 2017-CD6 & WFCM 2017-C39 | CMBX.11) was transferred for imminent default after its DSCR dropped below break-even in 2023 after years of declining occupancy, reported Morningstar Credit. The loan was previously specially serviced in 2022 at its original maturity; it was ultimately extended to July 2024 with two one-year extension options in exchange for an equity injection by the borrower. Performance post-modification has been lackluster although the loan has remained current.
- ◦Sale/Acquisition
- ◦Financing
