A recent report from the San Francisco Business Times revealed that a Brookfield Properties affiliate has acquired $915 million in mortgages for over 2,000 apartments in San Francisco owned by Veritas Investments. This transaction could potentially give Brookfield control of approximately 2,165 residential units across 76 apartment buildings. The debt purchased includes a $674.8-million loan secured by 62 residential buildings and an additional loan of around $130 million secured by 14 residential buildings.
In Dallas, it was reported that a California-based investor is set to purchase two office properties in Richardson out of bankruptcy from Houston-based Hartman SPE. The company filed for bankruptcy last summer and has been selling off its office and retail properties to focus on self-storage instead.
Meanwhile, Fortis Property Group LLC based in New York is facing default on part of the debt backing Colonnade Center – an office complex located along the Dallas North Tollway in Addison. With declining occupancy rates and higher leasing costs at this nearly 1.1-million-square-foot property, Fortis must meet a deadline of February first for their $223-million loan which represents the largest portion of their debt.
The Colonie Center ($103.5MM | CGCC2014-FL2) will be returning to special servicing after failing to pay off its maturity date back in December2023 accordingto Morningstar Credit reports.The Watergate Office Building($73.O MM|5.O%of BMARK2019-B14)has also fallen delinquent with both Octoberand November payments outstanding as notedbythe mostrecent servicer commentary.A lockbox was activatedin September2023due tonot meetinga required6 .25%debt yield hurdle.Meanwhile,the Hilton Garden Inn-Fort Washington ($15.IMM|CSAIL2017-C8|CMBX.ll),locatedinthepennsylvaniasuburbsofPhiladelphia,wassoldat a loss of $7.7 million to the trust after being in special servicing for an extended period of time.
East West Bank has filed a suit in San Francisco Superior Court to initiate judicial foreclosure and place 3100 N.First St.inSan Jose into receivershipin orderto recovera$25-million loanoriginatedforpropertyownerVista Investment Group back in 2018.The property was once fully leasedto chipmaker Broadcom Inc.,accordingtothe Silicon Valley Business Journal.
In summary, Brookfield Properties has acquired over $915 million worthof mortgages linked to more than2,000 apartments owned by Veritas Investmentsin San Francisco. In Dallas,a California-based investor is set topurchase two office properties out of bankruptcy from Hartman SPE,and Fortis Property Group LLC faces default on partof their debt backing Colonnade Center.In addition,the Colonie Center will be returningtospecialservicingand the Watergate Office Buildinghas fallen delinquent.Meanwhile,the Hilton Garden Inn-Fort Washingtonwas liquidated at a significant loss and East West Bank is taking steps towards recoveringa loan they originatedfor Vista InvestmentGroup’s North San Jose property.
