**Return to Lender: Week of May 1, 2025**
Several distressed commercial real estate assets across the country are heading to foreclosure or have already been taken back by lenders. Below is a summary of some notable transactions and developments:
– **400 South Tryon, Charlotte, NC**
The 32-story, 587,000-square-foot office tower known as 400 South Tryon has changed hands after its lenders foreclosed and reclaimed the property in a public auction earlier this month. Citizens Bank and Synovus Bank, operating as 400 South Tryon LP, placed the winning bid of $36 million. The building, previously valued at $115.3 million according to the latest county assessment, was foreclosed in December 2024 following a lawsuit against owners Oaktree Capital Group and Trinity Capital Advisors.
– **244 Jackson Street, San Francisco, CA**
A four-story mixed-use building located in San Francisco’s Jackson Square neighborhood is headed to a foreclosure auction next week. The property, burdened by a $13.6 million loan that matured in July 2024, remains vacant and was most recently appraised at $13.3 million—less than the loan value.
– **HarborView Marina, Baltimore, MD**
The 278-slip HarborView Marina in South Baltimore, which ceased operations at the end of March, will be sold at a foreclosure auction on May 28. The auction includes the marina and the first two floors of the building at 500 Harborview Drive, home to Di Pasquale’s Marketplace and an event venue. The sale is being managed by A.J. Billig & Co.
– **33 Cambridge St., Charlestown (Boston), MA**
Once slated for a 24-story tower, a mixed-use site in Sullivan Square will go to foreclosure auction on May 20. The less-than-half-acre property includes over 20,000 square feet of residential and commercial space. The auction will be conducted by JJ Manning Auctioneers. The parcel was previously part of a larger development plan by Rise Boston.
– **King of Prussia Hotels, PA**
The Buccini Pollin Group is preparing to surrender two King of Prussia hotels—Fairfield Inn Philadelphia Valley Forge/King of Prussia and Crowne Plaza Philadelphia King of Prussia—to debtholders ahead of a $32.5 million loan maturity in June. The 306-room portfolio had its debt transferred to special servicing in late December due to concerns of an impending default.
– **1140 Avenue of the Americas, New York, NY**
A $99 million securitized loan backed by the Midtown Manhattan office building at 1140 Ave. of the Americas has transferred to special servicing due to imminent monetary default. Occupancy has declined from 91% at issuance to 79% as of September 2024, with revenue underperforming and expenses rising since 2020.
– **NYC REIT Mixed Use Portfolio, New York, NY**
The NYC REIT Mixed Use Portfolio, valued at $50 million and comprising 7.6% of a commercial mortgage-backed securities deal, has been handed over to special servicing due to imminent default. The portfolio includes The Laurel, an Upper East Side office/parking asset, and the ICON Parking Garage on the Upper West Side. Cornell University, which occupied half the office space at The Laurel, vacated in September 2024.
– **Aspect RHG Hotel Portfolio**
This $43.7 million portfolio of four select-service and limited-service hotels across Tennessee, Colorado, and Arizona was moved to special servicing in late March amid potential default concerns. It is the second servicing period for the portfolio, which was previously distressed during the pandemic.
– **Hotel Eastlund, Portland, OR**
The $37.5 million loan associated with Hotel Eastlund has entered special servicing due to a payment default. In 2024, the hotel’s net cash flow fell 46% below issuance levels, mainly due to weak revenue and increased operating expenses, reducing the DSCR to just 0.94x. This marks another rough patch for the property, which was previously in special servicing from 2020 to 2022.
These cases illustrate a broader trend of distress across various commercial property types and markets, influenced by maturing debt, weak fundamentals, and shifting tenant dynamics.
