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Distressed Ginnie Mae Properties

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CRED iQ
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This week, CRED iQ calculated real-time valuations for 5 distressed multifamily properties that secure GNMA loans. Ginnie Mae loans secured by distressed properties as well as loans with near-term maturities are sources for intriguing opportunities within the multifamily sector that expand into several property sub-types, including seniors housing and workforce housing. Mortgage originators, distressed investors, and commercial brokers are able to search CRED iQ’s database of approximately 15,000 Ginnie Mae loans totaling $138 billion in outstanding debt for their next opportunity. The properties featured in this week’s WAR Report secure a subset of the largest distressed Ginnie Mae loans by outstanding balance that are at least 90 days delinquent.

CRED iQ valuations factor in a base-case (Most Likely), a downside (significant loss of tenants), and dark scenarios (100% vacant). For full access to the valuation reports as well as full CMBS loan reporting, including detailed financials, updated tenant information, and borrower contact information, sign up for a free trial here.

Lucas Place Lofts

130 units, Multifamily, Kansas City, MO 64105

GNMA 2015-36178M2A8

This $18.4 million loan, which is 90 days delinquent, is secured by a 130-unit multifamily loft conversion property located in Kansas City’s Garment District. The high-rise apartments were redeveloped from commercial use in 2010 and converted to loft-style units. The loan was issued through HUD’s 221(d)(4) program to facilitate the construction and rehabilitation of multifamily properties for moderate-income families, elderly, and the handicapped. The property also operates under a Chapter 353 Tax Abatement until 2023, which is an incentive for the redevelopment of blighted areas. The tax abatement was facilitated through the Missouri Department of Economic Development. Love Funding originated the loan in October 2012 and maturity is scheduled for March 2054. After the expiration of the tax abatement, property taxes for the property have potential to increase as much as 10 times the current burden. CRED iQ’s Base-Case valuation uses estimates for fully unabated property taxes. For full access to the valuation reports as well as full CMBS and GNMA loan reporting, including borrower contact information, sign up for a free trial here.

Menorah Campus Inc.

328 units, Seniors Housing, Getzville, NY 14068

GNMA 2010-3620ANWH9

This $17.4 million loan is over 120 days delinquent and is secured by a 328-unit residential care facility located about 10 miles northeast of Buffalo, NY, in close proximity to the University at Buffalo campus. The mortgage is a Section 232 loan, which facilitates the construction of assisted living facilities under the FHA’s mortgage insurance program. The loan was originated in 1991 by Berkadia Commercial Mortgage and carries a 40-year term.

The delinquency may be related to a pending sale of the property that has been held up due to pending approval by state regulators. Elderwood Administrative Services agreed to acquire the entire Weinberg Campus, which included the collateral property, in late 2017. However, the closing of the sale transaction has been delayed for several years. Prior to the announcement of the acquisition, the Menorah Campus reportedly suffered from increases in expense growth and fewer reimbursements. The property generated about $5.1 million in revenue but still had an operating loss of over $1.0 million. The sales agreement called for the entire Weinberg Campus, which includes Menorah Campus among other properties, to be acquired for $47.0 million. For full access to the valuation reports as well as full CMBS and GNMA loan reporting, including borrower contact information, sign up for a free trial here.

Oasis at 56th

124 units, Multifamily, Indianapolis, IN 46254

GNMA 2021-3617BWEF8

This $17.0 million loan is 90 days delinquent and is secured by a 124-unit assisted living facility located in suburban Indianapolis. The mortgage loan was originated in November 2017 by Walker & Dunlop and has a 40-year term. Similar to the Menorah Campus, detailed above, the Oasis at 56th property was financed through the FHA’s Section 232 program to aid in the development of assisted living facilities. The property was developed from the ground up for a cost of approximately $27.0 million and opened June 2019. Operations are managed by Gardant Management Solutions. For full access to the valuation reports as well as full CMBS and GNMA loan reporting, including borrower contact information, sign up for a free trial here.

Chatham Manufacturing Company (Mill 800 Apartments)

166 units, Multifamily, Winston-Salem, NC 27101

This $16.3 million loan, which is over 120 days delinquent, is secured by a 166-unit multifamily conversion located in Winston-Salem, NC. The property was formerly a manufacturing facility that produced a wide range of products from textiles to military equipment. The property, which now operates as Mill 800 Apartments, is the first phase of a mixed-use project that is planned to include additional office and retail space. Similar to Lucas Place Lofts, detailed above, the Mill 800 Apartments loan was issued through HUD’s 221(d)(4) program to aid development of blighted areas. The property was originally acquired in 2012. The 40-year Ginnie Mae loan was originated in 2014 and the apartments completed construction in 2016. For full access to the valuation reports as well as full CMBS and GNMA loan reporting, including borrower contact information, sign up for a free trial here.

Saucon Valley Manor Senior Living

207 units, Seniors Housing, Hellertown, PA 18055

GNMA 2012-36177YHY5

This $16.3 million loan is 90 days delinquent and is secured by a 207-unit senior living facility located about 10 miles east of Allentown, PA. The facility is part of a 5-property regional network of senior living facilities and offers multiple levels of care, including assisted living, independent living, memory care, and personal care. The property is about 147,782 sf and sits on a 2.6-acre parcel. The loan was issued through HUD’s 223(f) program and carries a 35-year term. M&T Realty Capital Corporation originated the mortgage in December 2012 and maturity is scheduled in January 2048. For full access to the valuation reports as well as full CMBS and GNMA loan reporting, including borrower contact information, sign up for a free trial here.

CRED iQ is a commercial real estate data, analytics, and valuation platform providing actionable intelligence to CRE and capital markets investors. Subscribers to CRED iQ use the platform to identify valuable leads for leasing, lending, refinancing, distressed debt, and acquisition opportunities. For full access to our loan database and valuation platform, sign up for a free trial below:

FREE TRIAL

Washington Prime Group Properties

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CRED iQ
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This week, CRED iQ calculated real-time valuations for 5 retail properties that are owned by Washington Prime Group (WPG), which declared bankruptcy on June 13, 2021. WPG made headlines late last week just before the beginning of Labor Day weekend when the shopping center REIT emerged from bankruptcy. A large part of the bankruptcy proceedings centered around the valuation of WPG’s assets, including its portfolio of over 100 retail properties. Many of WPG’s retail properties are encumbered by first lien mortgages that have been securitized in CMBS, including Dayton Mall and Brunswick Square, which were last featured in the August 3rd WAR Report. This week’s updated valuations aim to provide guidance for WPG properties with the highest amounts of outstanding mortgage debt.

CRED iQ valuations factor in a base-case (Most Likely), a downside (significant loss of tenants), and dark scenarios (100% vacant). For full access to the valuation reports as well as full CMBS loan reporting, including detailed financials, updated tenant information, and borrower contact information, sign up for a free trial here.

Pearlridge Center

903,692 sf, Regional Mall, Oahu, HI 96701

This $225.0 million loan ($130.4 million in senior debt and $94.6 million in subordinate debt) is secured by a combination of fee and leasehold interests in a super-regional mall complex located 9 miles outside of Honolulu, HI. Pearlridge Center is one of WPG’s most valuable properties, consisting of multiple phases. The Uptown portion of the property is anchored by Macy’s, TJ Maxx and Ross Dress for Less. The Downtown portion of the property was formerly anchored by a Sears, which is now vacant, and features a CVS as well as a movie theater. There is also an office portion of the property that consists of an 8-story building. Overall occupancy at the property remained stable at 91% throughout 2020 despite adverse impacts from the pandemic. The loan appeared on the master servicer’s watchlist during 2020 and 2021, citing the potential need for COVID-19 relief; however, the loan remained current in payment. Pearlridge Center was even able to avoid special servicing during WPG’s bankruptcy proceedings. Still, the pandemic has taken a toll on financial performance. NCF for 2020 was $19.7 million, which was a 13% decline from the prior year. The mortgage loan is scheduled to mature in June 2025. For the full valuation report and loan-level details, click here.

Waterford Lakes Town Center

691,265 sf, Power Center, Orlando, FL 32828

This $174.0 loan transferred to special servicing on March 31, 2021, which was before WPG’s bankruptcy filing. The transfer reason was cited as imminent non-monetary default and was likely affiliated with the impending bankruptcy. A forbearance agreement was signed in May 2021 that would grant WPG temporary relief from KeyBank, as special servicer, pursuing any rights and remedies related to the non-monetary default.

Waterford Lakes Town Center is one of WPG’s better positioned relative to its whole portfolio with its power center layout and location. The open-air retail center is located in Orlando, FL and is anchored by a Super Target, which does not serve as collateral for the mortgage loan. Updated servicer commentary stated the property was 96% occupied, although we anticipate elevated lease rollover risk prior to loan maturity in May 2029. The 5 largest tenants – Regal Cinemas, Best Buy, JOANN Fabrics, Bed Bath & Beyond, and Ross Dress for Less – all have lease expirations prior to loan maturity. All of these tenants, except for Bed Bath & Beyond, have a 5-year extension option. Four out of the 5-largest tenants have go-dark provisions in their lease agreements, which was a cause for concern during the early stages of the pandemic and remains a peripheral risk through loan maturity. For the full valuation report and loan-level details, click here.

Scottsdale Quarter

541,971 sf, Lifestyle Center, Scottsdale, AZ 85254

This $165.0 million loan ($95.0 million in senior debt and $70.0 million in subordinate debt) transferred to special servicing on March 22, 2021. Similar to Waterford Lakes Town Center, the transfer was affiliated with WPG’s eventual bankruptcy filing in June 2021. KeyBank, as special servicer, indicated that it would not enforce an event of default related to WPG’s bankruptcy. As part of that agreement, cash management provisions were put in place, but such provisions may be lifted now that WPG has exited bankruptcy.

The loan is secured by a mixed-use lifestyle center located in Scottsdale, AZ comprising of 66% retail and 33% office space. Primary retail tenants include Apple and Restoration Hardware. Primary office tenants include Starwood Hotels, Spaces – a coworking Regus affiliate, and Maracay Homes. WPG recently announced a positive leasing development for the retail portion of the property, stating that a lease has been signed with Landmark Theatres, which will backfill the vacant movie theater space that was formerly occupied by iPic Theaters. Notable retail tenants that have vacated since loan origination include H&M and Nike, which accounted for an aggregate 8% of the property’s GLA. CRED iQ estimates occupancy of 87% following the new lease with Landmark Theaters. For the full valuation report and loan-level details, click here.

Cottonwood Mall

410,832 sf, Regional Mall, Albuquerque, NM 87114

This $91.8 million loan transferred to special servicing on June 17, 2021 due to WPG’s bankruptcy. Unlike the previous 3 properties discussed, Cottonwood Mall is a weaker asset within WPG’s portfolio and the REIT classified the mall as a non-core asset. Updated commentary for the loan indicated WPG requested for a deed-in-lieu of foreclosure agreement with Midland Loan Services, the special servicer. Following receivership and a transfer of title, the mall would then need to be liquidated. The mortgage loan was over 90 days delinquent.

The loan is secured by 410,832 sf of in-line space at the Cottonwood Mall, which has five non-collateral anchor pads. Dillard’s (170,610 sf) and JCPenney (124,656 sf) are the two largest anchors in operation. There is also a 164,978-sf anchor pad that was formerly occupied by Macy’s but the space was backfilled by Hobby Lobby and 2 furniture stores. There is a 106,000-sf anchor pad that was formerly occupied by Sears and remains vacant. Conn’s HomePlus is the 5th non-collateral anchor with an 84,048-sf parcel. Notable collateral tenants include Regal Cinemas, Old Navy, and Ulta. For the full valuation report and loan-level details, click here.

Westminster Mall

771,844 sf, Regional Mall, Westminster, CA 92683

This $74.1 million loan is secured by 771,844 sf of a regional mall located in Orange County, CA. Westminster Mall features 4 anchor pads – Macy’s, a vacant former Sears, Target, and JCPenney. Macy’s and the vacant Sears space do not serve as collateral for the loan while Target and JCPenney own their improvements and operate pursuant to a ground lease with WPG. The mall was reported to be 88% occupied; however NCF declined sharply in 2020. The Westminster Mall generated NCF of $4.7 million during 2020, which was a 51% decline compared to origination. Despite cash flow issues, the property has a desirable location in Orange County with redevelopment potential and underlying land value.

The loan has not yet transferred to special servicer despite a below breakeven DSCR during 2020. A favorable tax appeal ruling could have potential to alleviate potential debt service coverage issues; however, the decline in NCF remains a major concern. The loan has been on the servicer’s watchlist since December 2019. For the full valuation report and loan-level details, click here.

CRED iQ is a commercial real estate data, analytics, and valuation platform providing actionable intelligence to CRE and capital markets investors. Subscribers to CRED iQ use the platform to identify valuable leads for leasing, lending, refinancing, distressed debt, and acquisition opportunities. For full access to our loan database and valuation platform, sign up for a free trial below:

FREE TRIAL

September 2021 Delinquency Report

By
CRED iQ
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0

The overall delinquency rate declined for the 14th consecutive month since its peak in June 2020 and broke below 6% this month. Although the past year has shown a consistent trend in lower delinquencies, the recovery of distressed assets still has some distance before reaching pre-pandemic levels of sub-3%. Lodging and retail are still the leaders by property type with the highest individual delinquency rates; although, several hotel markets have posted delinquency declines this month including Kansas City, Los Angeles, Raleigh, and Pittsburgh. New Orleans was among the lodging markets that had the highest month-over-month increase in delinquency.

CRED iQ monitors market performance for nearly 400 MSAs across the United States. Below is a summary of the default rates for the 50 largest metros segmented by property type. For these 50 MSAs, the highest delinquency rate was in Minneapolis, followed by Louisville and New Orleans. The New Orleans market saw the largest month-over-month increase in delinquency, which allowed the MSA to surpass Cleveland amongst the regions with the highest delinquency rates. Allentown and Sacramento reported the lowest delinquency rate among the Top 50 MSAs. The most significant month over-month decline in delinquency was in the San Francisco market, which was attributed to the $1.5 billion Parkmerced loan paying current after a 30-day delinquency in July.

For the full report, download here:

The-CRED-DQ-Report-September-2021-1Download

By property type, the hotel and retail sectors remain the largest contributors to the delinquency percentages for the majority of these statistical areas. Loans backed by self-storage, multifamily, and industrial facilities posted the lowest delinquency rates for most of these markets.

MSA – Property TypeDQ/SS
(millions)		DQ/SS
(%)		Monthly
Change
Allentown-Bethlehem-Easton, PA-NJ MSA$19.40.6%0.00%
Allentown – Hotel$0.00.0%0.00%
Allentown – Industrial$0.00.0%0.00%
Allentown – Multifamily$0.00.0%0.00%
Allentown – Office$0.00.0%0.00%
Allentown – Other$0.00.0%0.00%
Allentown – Retail$19.45.1%0.00%
Allentown – Self Storage$0.00.0%0.00%
Atlanta – Atlanta-Sandy Springs-Marietta, GA MSA$749.33.1%-0.16%
Atlanta – Hotel$247.712.9%-0.01%
Atlanta – Industrial$0.00.0%0.00%
Atlanta – Multifamily$4.70.0%-0.29%
Atlanta – Office$34.01.2%0.02%
Atlanta – Other$0.00.0%0.00%
Atlanta – Retail$462.917.1%0.00%
Atlanta – Self Storage$0.00.0%0.00%
Austin – Austin-Round Rock, TX MSA$563.46.0%0.51%
Austin – Hotel$419.344.6%-0.08%
Austin – Industrial$0.00.0%0.00%
Austin – Multifamily$36.00.6%0.51%
Austin – Office$0.00.0%0.00%
Austin – Other$0.00.0%0.00%
Austin – Retail$105.615.6%3.22%
Austin – Self Storage$2.52.1%0.00%
Baltimore – Baltimore-Towson, MD MSA$448.34.6%-0.17%
Baltimore – Hotel$128.727.8%-2.92%
Baltimore – Industrial$0.00.0%0.00%
Baltimore – Multifamily$6.10.1%0.06%
Baltimore – Office$23.03.6%0.00%
Baltimore – Other$0.00.0%0.00%
Baltimore – Retail$290.626.5%0.02%
Baltimore – Self Storage$0.00.0%0.00%
Birmingham – Birmingham-Hoover, AL MSA$45.61.8%-0.10%
Birmingham – Hotel$22.721.4%0.08%
Birmingham – Industrial$0.00.0%0.00%
Birmingham – Multifamily$0.00.0%-0.19%
Birmingham – Office$0.00.0%0.00%
Birmingham – Other$0.00.0%0.00%
Birmingham – Retail$23.03.2%-0.02%
Birmingham – Self Storage$0.00.0%0.00%
Boston – Boston-Cambridge-Quincy, MA-NH MSA$367.12.1%-0.14%
Boston – Hotel$110.814.4%1.56%
Boston – Industrial$0.00.0%0.00%
Boston – Multifamily$0.00.0%0.00%
Boston – Office$0.00.0%0.00%
Boston – Other$0.00.0%0.00%
Boston – Retail$256.313.0%-1.67%
Boston – Self Storage$0.00.0%0.00%
Bridgeport – Bridgeport-Stamford-Norwalk, CT MSA$224.35.6%-1.02%
Bridgeport – Hotel$63.751.7%0.43%
Bridgeport – Industrial$17.813.6%0.71%
Bridgeport – Multifamily$0.00.0%0.00%
Bridgeport – Office$97.57.9%-3.08%
Bridgeport – Other$23.65.8%0.00%
Bridgeport – Retail$21.76.1%-0.29%
Bridgeport – Self Storage$0.00.0%0.00%
Charlotte – Charlotte-Gastonia-Concord, NC-SC MSA$352.54.4%0.06%
Charlotte – Hotel$130.010.6%1.49%
Charlotte – Industrial$0.00.0%0.00%
Charlotte – Multifamily$0.00.0%0.00%
Charlotte – Office$21.32.5%0.00%
Charlotte – Other$92.625.9%0.47%
Charlotte – Retail$108.77.9%0.10%
Charlotte – Self Storage$0.00.0%0.00%
Chicago – Chicago-Naperville-Joliet, IL-IN-WI MSA$2,067.57.8%-1.43%
Chicago – Hotel$1,121.852.6%3.00%
Chicago – Industrial$0.00.0%-0.19%
Chicago – Multifamily$134.41.4%-0.50%
Chicago – Office$386.55.4%-4.45%
Chicago – Other$117.95.9%0.13%
Chicago – Retail$306.99.1%-0.80%
Chicago – Self Storage$0.00.0%0.00%
Cincinnati – Cincinnati-Middletown, OH-KY-IN MSA$318.48.5%-0.07%
Cincinnati – Hotel$141.246.3%0.00%
Cincinnati – Industrial$0.00.0%0.00%
Cincinnati – Multifamily$1.60.1%-0.04%
Cincinnati – Office$11.52.3%-0.11%
Cincinnati – Other$15.75.0%-0.07%
Cincinnati – Retail$147.420.9%0.19%
Cincinnati – Self Storage$1.01.6%0.00%
Cleveland – Cleveland-Elyria-Mentor, OH MSA$596.914.3%0.02%
Cleveland – Hotel$135.459.0%-0.04%
Cleveland – Industrial$0.00.0%0.00%
Cleveland – Multifamily$0.00.0%-0.37%
Cleveland – Office$105.312.6%-0.01%
Cleveland – Other$173.540.3%3.69%
Cleveland – Retail$182.620.6%-0.04%
Cleveland – Self Storage$0.00.0%0.00%
Columbus, OH – Columbus, OH MSA$251.84.2%-0.16%
Columbus, OH – Hotel$84.626.8%0.30%
Columbus, OH – Industrial$11.92.8%-0.01%
Columbus, OH – Multifamily$4.30.1%-0.27%
Columbus, OH – Office$12.52.4%0.00%
Columbus, OH – Other$0.00.0%0.00%
Columbus, OH – Retail$128.015.0%0.10%
Columbus, OH – Self Storage$10.417.9%0.03%
Dallas – Dallas-Fort Worth-Arlington, TX MSA$1,040.53.1%0.03%
Dallas – Hotel$443.812.3%-0.42%
Dallas – Industrial$1.70.1%0.00%
Dallas – Multifamily$47.70.2%-0.01%
Dallas – Office$212.15.6%1.06%
Dallas – Other$23.91.4%-0.20%
Dallas – Retail$300.111.9%0.34%
Dallas – Self Storage$11.22.2%0.11%
Denver – Denver-Aurora, CO MSA$334.82.0%-0.31%
Denver – Hotel$43.45.0%-3.39%
Denver – Industrial$0.00.0%0.00%
Denver – Multifamily$0.00.0%-0.03%
Denver – Office$194.49.3%-0.90%
Denver – Other$7.01.2%0.06%
Denver – Retail$87.05.7%-0.15%
Denver – Self Storage$3.11.8%0.00%
Detroit – Detroit-Warren-Livonia, MI MSA$608.26.8%0.19%
Detroit – Hotel$316.741.6%0.05%
Detroit – Industrial$45.98.5%1.05%
Detroit – Multifamily$42.51.3%0.20%
Detroit – Office$6.60.4%0.40%
Detroit – Other$22.53.4%0.06%
Detroit – Retail$174.110.1%-0.10%
Detroit – Self Storage$0.00.0%0.00%
Hartford – Hartford-West Hartford-East Hartford, CT MSA$212.18.6%-0.64%
Hartford – Hotel$89.260.6%-3.65%
Hartford – Industrial$0.00.0%0.00%
Hartford – Multifamily$3.90.3%-0.55%
Hartford – Office$87.622.2%0.02%
Hartford – Other$1.20.6%0.01%
Hartford – Retail$30.312.6%-0.42%
Hartford – Self Storage$0.00.0%0.00%
Houston – Houston-Sugar Land-Baytown, TX MSA$1,485.55.3%-0.90%
Houston – Hotel$705.759.6%-0.33%
Houston – Industrial$10.91.6%0.07%
Houston – Multifamily$80.80.6%-0.32%
Houston – Office$528.213.5%-0.78%
Houston – Other$33.90.9%-2.97%
Houston – Retail$97.92.6%-0.20%
Houston – Self Storage$28.25.8%0.18%
Indianapolis – Indianapolis-Carmel, IN MSA$386.28.0%-1.03%
Indianapolis – Hotel$169.226.6%0.01%
Indianapolis – Industrial$0.00.0%0.00%
Indianapolis – Multifamily$97.24.5%-0.51%
Indianapolis – Office$67.810.6%-0.60%
Indianapolis – Other$9.84.6%-0.15%
Indianapolis – Retail$38.27.0%-2.15%
Indianapolis – Self Storage$4.05.2%0.00%
Jacksonville – Jacksonville, FL MSA$67.61.3%-0.25%
Jacksonville – Hotel$38.68.9%-2.20%
Jacksonville – Industrial$0.00.0%0.00%
Jacksonville – Multifamily$20.00.6%-0.09%
Jacksonville – Office$0.00.0%0.00%
Jacksonville – Other$0.00.0%0.00%
Jacksonville – Retail$9.12.1%0.00%
Jacksonville – Self Storage$0.00.0%0.00%
Kansas City – Kansas City, MO-KS MSA$163.23.5%-4.66%
Kansas City – Hotel$97.931.1%-16.55%
Kansas City – Industrial$0.00.0%0.00%
Kansas City – Multifamily$7.60.3%-0.01%
Kansas City – Office$0.00.0%-18.21%
Kansas City – Other$2.81.2%-0.88%
Kansas City – Retail$53.38.2%2.39%
Kansas City – Self Storage$1.60.8%0.00%
Las Vegas – Las Vegas-Paradise, NV MSA$393.82.0%-0.34%
Las Vegas – Hotel$18.30.3%0.00%
Las Vegas – Industrial$0.00.0%0.00%
Las Vegas – Multifamily$0.00.0%0.00%
Las Vegas – Office$10.21.7%0.06%
Las Vegas – Other$0.00.0%0.00%
Las Vegas – Retail$362.67.5%-1.43%
Las Vegas – Self Storage$2.61.4%0.05%
Los Angeles – Los Angeles-Long Beach-Santa Ana, CA MSA$1,997.44.1%-0.89%
Los Angeles – Hotel$647.415.8%-9.11%
Los Angeles – Industrial$2.00.2%0.00%
Los Angeles – Multifamily$133.50.6%0.02%
Los Angeles – Office$368.73.1%0.00%
Los Angeles – Other$197.76.5%-1.56%
Los Angeles – Retail$644.69.4%0.13%
Los Angeles – Self Storage$3.50.4%0.36%
Louisville – Louisville/Jefferson County, KY-IN MSA$632.820.4%0.09%
Louisville – Hotel$243.054.2%0.03%
Louisville – Industrial$0.00.0%0.00%
Louisville – Multifamily$3.80.3%0.00%
Louisville – Office$0.00.0%0.00%
Louisville – Other$0.00.0%0.00%
Louisville – Retail$386.159.1%0.14%
Louisville – Self Storage$0.00.0%0.00%
Memphis – Memphis, TN-AR-MS MSA$156.86.5%-1.90%
Memphis – Hotel$56.327.5%0.20%
Memphis – Industrial$0.00.0%0.00%
Memphis – Multifamily$17.81.7%-0.66%
Memphis – Office$0.00.0%-11.38%
Memphis – Other$18.433.7%1.83%
Memphis – Retail$62.715.3%0.05%
Memphis – Self Storage$1.61.0%0.00%
Miami – Miami-Fort Lauderdale-Pompano Beach, FL MSA$843.23.9%-0.76%
Miami – Hotel$375.78.2%0.04%
Miami – Industrial$0.00.0%0.00%
Miami – Multifamily$5.80.1%-0.04%
Miami – Office$21.71.1%-2.68%
Miami – Other$8.70.6%-4.20%
Miami – Retail$431.48.9%-0.72%
Miami – Self Storage$0.00.0%0.00%
Milwaukee – Milwaukee-Waukesha-West Allis, WI MSA$255.410.5%-0.09%
Milwaukee – Hotel$35.723.1%-0.01%
Milwaukee – Industrial$0.00.0%0.00%
Milwaukee – Multifamily$0.00.0%0.00%
Milwaukee – Office$66.411.6%0.00%
Milwaukee – Other$0.00.0%0.00%
Milwaukee – Retail$153.230.5%0.23%
Milwaukee – Self Storage$0.00.0%0.00%
Minneapolis – Minneapolis-St. Paul-Bloomington, MN-WI MSA$1,932.323.3%-2.99%
Minneapolis – Hotel$332.552.6%0.29%
Minneapolis – Industrial$4.11.5%-3.88%
Minneapolis – Multifamily$0.00.0%0.00%
Minneapolis – Office$152.47.4%-12.26%
Minneapolis – Other$11.73.0%0.17%
Minneapolis – Retail$1,431.870.6%0.78%
Minneapolis – Self Storage$0.00.0%0.00%
Nashville – Nashville-Davidson-Murfreesboro-Franklin, TN MSA$351.45.6%-0.28%
Nashville – Hotel$339.224.8%-1.11%
Nashville – Industrial$0.00.0%0.00%
Nashville – Multifamily$0.00.0%0.00%
Nashville – Office$0.00.0%0.00%
Nashville – Other$0.00.0%0.00%
Nashville – Retail$12.11.6%-0.01%
Nashville – Self Storage$0.00.0%0.00%
New Orleans – New Orleans-Metairie-Kenner, LA MSA$487.414.3%1.09%
New Orleans – Hotel$451.140.4%1.91%
New Orleans – Industrial$0.00.0%0.00%
New Orleans – Multifamily$13.41.7%0.00%
New Orleans – Office$0.00.0%0.00%
New Orleans – Other$0.00.0%0.00%
New Orleans – Retail$22.92.9%-0.01%
New Orleans – Self Storage$0.00.0%0.00%
New York City – New York-Northern New Jersey-Long Island, NY-NJ-PA MSA$6,718.55.7%0.15%
New York City – Hotel$1,860.049.8%-0.30%
New York City – Industrial$7.50.5%0.03%
New York City – Multifamily$523.91.6%0.12%
New York City – Office$734.61.7%-0.11%
New York City – Other$1,636.67.8%0.06%
New York City – Retail$1,955.913.8%-0.32%
New York City – Self Storage$0.00.0%0.00%
Orlando – Orlando-Kissimmee, FL MSA$476.84.1%-0.58%
Orlando – Hotel$186.56.5%-1.87%
Orlando – Industrial$0.00.0%0.00%
Orlando – Multifamily$25.50.4%0.01%
Orlando – Office$47.19.6%0.01%
Orlando – Other$0.00.0%0.00%
Orlando – Retail$217.720.5%-1.95%
Orlando – Self Storage$0.00.0%0.00%
Philadelphia – Philadelphia-Camden-Wilmington, PA-NJ-DE-MD MSA$991.35.3%0.05%
Philadelphia – Hotel$380.340.9%9.17%
Philadelphia – Industrial$0.00.0%0.00%
Philadelphia – Multifamily$118.61.3%0.00%
Philadelphia – Office$51.11.2%0.10%
Philadelphia – Other$79.35.7%-0.15%
Philadelphia – Retail$362.014.2%0.03%
Philadelphia – Self Storage$0.00.0%0.00%
Phoenix – Phoenix-Mesa-Scottsdale, AZ MSA$594.73.1%-0.38%
Phoenix – Hotel$80.54.8%-1.17%
Phoenix – Industrial$10.21.9%-0.02%
Phoenix – Multifamily$0.00.0%0.00%
Phoenix – Office$23.81.1%-2.13%
Phoenix – Other$180.524.1%0.42%
Phoenix – Retail$299.77.5%-0.11%
Phoenix – Self Storage$0.00.0%0.00%
Pittsburgh – Pittsburgh, PA MSA$202.54.3%-0.51%
Pittsburgh – Hotel$125.342.9%-5.99%
Pittsburgh – Industrial$0.00.0%0.00%
Pittsburgh – Multifamily$0.00.0%0.00%
Pittsburgh – Office$15.41.7%0.00%
Pittsburgh – Other$8.12.1%0.09%
Pittsburgh – Retail$53.67.3%0.11%
Pittsburgh – Self Storage$0.00.0%0.00%
Portland – Portland-Vancouver-Beaverton, OR-WA MSA$532.78.2%-0.74%
Portland – Hotel$520.959.2%-6.07%
Portland – Industrial$0.00.0%0.00%
Portland – Multifamily$10.20.2%0.00%
Portland – Office$1.60.5%0.00%
Portland – Other$0.00.0%0.00%
Portland – Retail$0.00.0%0.00%
Portland – Self Storage$0.00.0%0.00%
Raleigh – Raleigh-Cary, NC MSA$135.23.3%-0.92%
Raleigh – Hotel$86.619.2%-7.70%
Raleigh – Industrial$0.00.0%0.00%
Raleigh – Multifamily$0.00.0%0.00%
Raleigh – Office$12.74.0%0.00%
Raleigh – Other$0.00.0%0.00%
Raleigh – Retail$35.88.1%-1.24%
Raleigh – Self Storage$0.00.0%0.00%
Richmond – Richmond, VA MSA$142.04.1%-0.22%
Richmond – Hotel$50.617.8%0.29%
Richmond – Industrial$6.94.9%-0.12%
Richmond – Multifamily$0.00.0%-0.56%
Richmond – Office$0.00.0%0.00%
Richmond – Other$0.00.0%0.00%
Richmond – Retail$84.415.3%0.06%
Richmond – Self Storage$0.00.0%0.00%
Riverside – Riverside-San Bernardino-Ontario, CA MSA$393.94.2%-0.36%
Riverside – Hotel$85.017.1%-1.92%
Riverside – Industrial$0.00.0%0.00%
Riverside – Multifamily$2.40.1%-0.08%
Riverside – Office$0.00.0%0.00%
Riverside – Other$0.00.0%0.00%
Riverside – Retail$306.513.9%0.31%
Riverside – Self Storage$0.00.0%0.00%
Sacramento – Sacramento-Arden-Arcade-Roseville, CA MSA$31.00.6%0.00%
Sacramento – Hotel$6.31.7%0.00%
Sacramento – Industrial$0.00.0%0.00%
Sacramento – Multifamily$0.00.0%0.00%
Sacramento – Office$11.01.9%0.93%
Sacramento – Other$0.00.0%0.00%
Sacramento – Retail$13.81.8%-0.57%
Sacramento – Self Storage$0.00.0%0.00%
Salt Lake City – Salt Lake City, UT MSA$187.05.1%-0.25%
Salt Lake City – Hotel$47.615.3%-0.01%
Salt Lake City – Industrial$0.00.0%0.00%
Salt Lake City – Multifamily$0.00.0%0.00%
Salt Lake City – Office$0.00.0%-1.85%
Salt Lake City – Other$0.00.0%0.00%
Salt Lake City – Retail$139.429.9%0.07%
Salt Lake City – Self Storage$0.00.0%0.00%
San Antonio – San Antonio, TX MSA$201.83.1%0.00%
San Antonio – Hotel$26.27.8%0.29%
San Antonio – Industrial$0.00.0%0.00%
San Antonio – Multifamily$8.20.2%-0.01%
San Antonio – Office$0.00.0%-1.44%
San Antonio – Other$0.40.2%-0.24%
San Antonio – Retail$165.618.8%1.61%
San Antonio – Self Storage$1.40.9%0.00%
San Diego – San Diego-Carlsbad-San Marcos, CA MSA$231.22.1%-4.03%
San Diego – Hotel$79.53.7%-21.11%
San Diego – Industrial$0.00.0%0.00%
San Diego – Multifamily$9.60.2%0.01%
San Diego – Office$0.00.0%0.00%
San Diego – Other$20.83.3%0.01%
San Diego – Retail$121.310.3%0.19%
San Diego – Self Storage$0.00.0%0.00%
San Francisco – San Francisco-Oakland-Fremont, CA MSA$331.91.5%-5.76%
San Francisco – Hotel$212.19.0%0.37%
San Francisco – Industrial$0.00.0%0.00%
San Francisco – Multifamily$22.60.3%-17.77%
San Francisco – Office$18.90.2%-0.10%
San Francisco – Other$30.61.7%0.01%
San Francisco – Retail$47.83.6%-0.02%
San Francisco – Self Storage$0.00.0%0.00%
San Jose – San Jose-Sunnyvale-Santa Clara, CA MSA$171.11.2%0.00%
San Jose – Hotel$156.47.7%0.13%
San Jose – Industrial$0.00.0%0.00%
San Jose – Multifamily$0.00.0%0.00%
San Jose – Office$14.70.2%0.00%
San Jose – Other$0.00.0%0.00%
San Jose – Retail$0.00.0%0.00%
San Jose – Self Storage$0.00.0%0.00%
Seattle – Seattle-Tacoma-Bellevue, WA MSA$245.01.4%-0.30%
Seattle – Hotel$238.218.0%-2.61%
Seattle – Industrial$0.00.0%0.00%
Seattle – Multifamily$0.00.0%0.00%
Seattle – Office$0.00.0%0.00%
Seattle – Other$0.00.0%0.00%
Seattle – Retail$6.80.4%0.01%
Seattle – Self Storage$0.00.0%-2.41%
St. Louis – St. Louis, MO-IL MSA$420.39.6%-0.07%
St. Louis – Hotel$58.620.6%0.04%
St. Louis – Industrial$0.00.0%0.00%
St. Louis – Multifamily$23.41.4%0.00%
St. Louis – Office$107.619.1%0.02%
St. Louis – Other$24.74.9%-0.01%
St. Louis – Retail$206.020.1%-0.18%
St. Louis – Self Storage$0.00.0%0.00%
Tampa – Tampa-St. Petersburg-Clearwater, FL$386.33.9%-0.31%
Tampa – Hotel$74.96.3%0.00%
Tampa – Industrial$0.00.0%0.00%
Tampa – Multifamily$34.70.6%-0.06%
Tampa – Office$24.14.1%0.00%
Tampa – Other$0.00.0%0.00%
Tampa – Retail$252.618.8%-1.76%
Tampa – Self Storage$0.00.0%0.00%
Tucson – Tucson, AZ MSA$267.47.5%0.04%
Tucson – Hotel$1.40.4%0.00%
Tucson – Industrial$0.00.0%0.00%
Tucson – Multifamily$0.00.0%0.00%
Tucson – Office$0.00.0%0.00%
Tucson – Other$0.00.0%0.00%
Tucson – Retail$266.018.6%0.34%
Tucson – Self Storage$0.00.0%0.00%
Virginia Beach – Virginia Beach-Norfolk-Newport News, VA-NC MSA$254.35.8%-0.13%
Virginia Beach – Hotel$24.75.3%-2.98%
Virginia Beach – Industrial$21.213.1%-0.01%
Virginia Beach – Multifamily$0.00.0%0.00%
Virginia Beach – Office$12.63.1%-0.02%
Virginia Beach – Other$0.00.0%0.00%
Virginia Beach – Retail$187.120.6%1.08%
Virginia Beach – Self Storage$8.89.9%0.31%
Washington – Washington-Arlington-Alexandria, DC-VA-MD-WV MSA$986.83.5%0.14%
Washington – Hotel$59.25.3%-0.65%
Washington – Industrial$0.00.0%0.00%
Washington – Multifamily$1.30.0%-0.02%
Washington – Office$508.68.0%0.79%
Washington – Other$249.712.4%0.45%
Washington – Retail$168.15.4%-0.01%
Washington – Self Storage$0.00.0%0.00%
Grand Total – Top 50 MSAs$31,254.94.7%-0.59%
Source: CRED iQ

REO Regional Malls

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CRED iQ
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This week, CRED iQ calculated real-time valuations for 5 regional malls that have had title transfers in the past year and are now REO. The updated valuations serve as a follow-up to our August 18 blog – CRED iQ in the News – Regional Mall Distress. The featured assets are the 5 largest malls, by outstanding debt, that have become REO since the onset of the pandemic. One of the featured properties, Oakdale Mall, reportedly has secured a buyer with major redevelopment plants. Check out the commentary below for more detail! CRED iQ valuations factor in a base-case (Most Likely), a downside (significant loss of tenants), and dark scenarios (100% vacant). For full access to the valuation reports as well as full CMBS loan reporting, including detailed financials, updated tenant information, and borrower contact information, sign up for a free trial here.

Town Center at Cobb

559,940 sf, Regional Mall, Kennesaw, GA 30144

This property, which has outstanding debt of $172.5 million, has been with the special servicer since June 2020. Title to the property transferred to KeyBank, as special servicer, from Simon Property Group in January 2021 via foreclosure. KeyBank appears to still be in the process of assessing the timeline for liquidation, although March 2022 was provided as an estimated resolution date.

The Town Center at Cobb, located approximately 25 miles northwest of Atlanta, features 5 anchor pads that include 2 separate Macy’s boxes, a vacant former Sears box, a JCPenney, and a Belk. The REO portion of the property only includes the ground and improvements for the 128,819-sf Belk parcel as the other 4 pads did not secure the mortgage debt. Additionally, Belk has a near-term lease expiration in August 2022. An updated appraisal of $130.4 million ($233/sf) was reported last August and was equal to a 60% decline in value since the mortgage loan was originated. CRED-iQ’s Base-Case Valuation calculates a lower figure given uncertainty regarding Belk’s lease renewal and continued occupancy declines. For the full valuation report and loan-level details, click here.

Florence Mall

384,111 sf, Regional Mall, Florence, KY 41042

This property, which has outstanding debt of $89.4 million, has been with the special servicer since July 2020. Florence Mall, located in the suburbs of Cincinnati, OH, was formerly owned by Brookfield Property Partners but the firm agreed to a deed-in-lieu of foreclosure agreement with KeyBank in January 2021. The REO portion of the property solely consists of in-line space and a 68,324-sf movie theater outparcel. A vacant former Sears box, 2 separate Macy’s boxes, and a JCPenney make up the non-collateral anchor mix.

Updated servicer commentary stated the property was 82% occupied. The last full-year financials for the property indicated a DSCR of 2.16 for 2019, which is a prime example of the acceleration of credit deterioration brought on by the pandemic in the form of tenant departures, rent collection issues, and reduced foot traffic. JLL has been put in place to manage the property until the mall can be put to market for a liquidation sale. For the full valuation report and loan-level details, click here.

Southland Mall

660,736 sf, Regional Mall, Cutler Bay, FL 33189

This property, which has outstanding debt of $65.2 million, has been with the special servicer since April 2020. KeyBank, as special servicer, pursued foreclosure on the mall and acquired title to the property in March 2021. Southland Mall is located about 20 miles south of Miami and features 4 anchor parcels: a vacant former Sears, Macy’s, JCPenney, and Regal Cinemas. Sears and Macy’s are owned by separate entities and are not part of the REO collateral. However, the REO title vesting includes a 148,841-sf freestanding retail strip located to the north of the mall that is leased to a 28,450-sf Ross Dress for Less and was leased to a former K-Mart, which is now partly occupied by a church.

Prior to the mall’s foreclosure, it was encumbered by floating-rate mortgage debt as well as $41.0 million in mezzanine debt, which equated to a 91% LTV based on cumulative debt at origination. Prospective buyers will likely be concerned with lease rollover risk at the property as leases for the three-largest tenants, accounting for 28% of the GLA, are scheduled to expire in 2022. For the full valuation report and loan-level details, click here.

Newgate Mall

497,962 sf, Regional Mall, Ogden, UT 84405

This property, which has outstanding debt of $58.0 million, has been with the special servicer since March 2020. Rialto foreclosed on the property and acquired title from Time Equities Inc. in March 2021. The mall is now managed by The Woodmont Company and the sale of the asset is targeted for early-2022. The Newgate Mall, located 35 miles north of Salt Lake City, has 3 anchor pads consisting of a 149,624-sf vacant former Sears, Dillard’s, and a Burlington Coat Factory. Dillard’s and Burlington are owned by separate entities and are not part of the REO offering. The Burlington space has turned over several times in recent history, with the box previously occupied by GlowGolf and Mervyn’s prior to that. The REO portion of the property also includes a 61,970-sf junior anchor Cinemark movie theater and a DownEast Home & Clothing, which backfilled a former Sports Authority. For the full valuation report and loan-level details, click here.

Oakdale Mall

708,695 sf, Regional Mall, Johnson City, NY 13790

This property, which has outstanding debt of $47.5 million, has been with the special servicer since June 2018. Rialto acquired title to the property from Interstate Properties through a deed-in-lieu of foreclosure agreement in September 2020. The mall had been severely distressed pre-COVID when the mortgage loan had a below breakeven DSCR in 2018 and 2019. Positive developments for the mall came to fruition in recent weeks in the form of a 25-year payment-in-lieu-of-taxes (PILOT) program that would reduce real estate tax expense for the property from approximately $3.5 million to $449,000 for the next 5 years before scaling back up to $1.1 million in year 25. The PILOT agreement is in conjunction with a potential sale to Spark JC LLC, a local developer that acquired the vacant Sears portion of the mall in 2019. SPARK JC LLC plans to convert the former Sears box into a hospital and social services center.

The development firm also reportedly negotiated a $6.5 million settlement with Rialto for a tax lawsuit and is finalizing the acquisition of the property for approximately $8.5 million ($12/sf). In total, the redevelopment project is estimated to cost $116.0 million with plans convert the Oakdale Mall into a diversified mixed-use project named Oakdale Commons. For additional details, full valuation report, and loan-level details, click here.

CRED iQ is a commercial real estate data, analytics, and valuation platform providing actionable intelligence to CRE and capital markets investors. Subscribers to CRED iQ use the platform to identify valuable leads for leasing, lending, refinancing, distressed debt, and acquisition opportunities. For full access to our loan database and valuation platform, sign up for a free trial below:

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Top Markets for Distressed Hotel Opportunities

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CRED iQ
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This week, CRED iQ leveraged our data platform to analyze 5 primary lodging markets with the highest volume of distressed loans secured by hotels. Within each market, we highlighted opportunities where the potential for pricing dislocation may be present. These are loans that have transferred to special servicing but have not received an updated appraisal or BOV in the past 12 months. Updated valuations for these properties are likely dislocated from appraisal values at origination and may be lower, in many cases, given past deterioration in financial performance. CRED iQ valuations factor in a base-case (Most Likely), a downside (significant disruption of occupancy), and dark scenarios (permanent or temporary operational shutdown). For full access to the valuation reports as well as full CMBS loan reporting, including detailed financials, updated tenant information, and borrower contact information, sign up for a free trial here.

In our August 2021 CRED DQ Report, we highlighted delinquent and specially serviced loans by MSA and Property Type. With hotel as the worst performing property type, we focused on 5 of the Top 50 MSAs that had the highest amount of distressed debt by outstanding loan balance. New York, Chicago, Los Angeles, Houston, and Portland were the leading markets for distressed hotel debt. Three of the markets, New York, Chicago and LA, each had over $1 billion in distressed debt. Although Houston and Portland rounded out the list of 5 markets, both MSAs are Top 3 in highest percentage of delinquent and specially serviced loans. We take a closer look at each market below.

New York

The New York-Northern New Jersey-Long Island, NY-NJ-PA MSA has approximately $1.87 billion in distressed CMBS debt secured by lodging properties, accounting for just about half of all outstanding debt in the market by outstanding balance. New York, and Manhattan especially, has experienced deep and longstanding effects from the pandemic and ongoing headwinds from the Delta variant have continued to preclude a predictable and timely recovery. A recent example of asset repricing is Royalton Park Avenue (fka Gansevoort Park Avenue), which was featured in the July 14, 2021 WAR Report. The mortgage loan secured by the hotel has since been modified and an updated June 2021 appraisal of $98.2 million represented a 65% decline in value since origination in 2012. Below is a snapshot of some other distressed lodging loans that may also be due for updated valuations:

Property NameAddressOutstanding Balance
(millions)		DQ StatusCRED iQ Base-Case Value
(millions)		Most Recent Appraisal
(millions)		Most Recent
Appraisal Date
The Standard Highline NYC848 Washington St
New York, NY 10014		$170.090+ Days$151.0$241.09/30/2020
Hilton Garden Inn W 54th Street237 W 54th St
New York, NY 10019		$155.0Current$177.0$251.011/24/2014
Holiday Inn FiDi99 Washington St
New York, NY 10006		$87.0121+ Days$91.3$233.07/26/2018
Hilton Times Square*234 W 42nd St
New York, NY 10036		$75.6REO$50.9$246.010/13/2010
Hilton Long Island Huntington598 Broad Hollow Rd
Melville, NY 11747		$33.330+ Days$40.1$52.35/11/2016
* The property comprises a leasehold interest in the 460-key hotel and operates pursuant to a ground lease that is due for a reset. The Base-Case Valuation assumes stabilized operations with an estimated increase in ground rent. However, an unfavorable outcome from the results of negotiations with the ground lessor could result in a nominal value or reversion of the property to the ground lessor.

Source: CRED iQ

Chicago

The Chicago-Naperville-Joliet, IL-IN-WI MSA has approximately $1.1 billion in distressed CMBS debt secured by lodging properties, accounting for just under 50% of total outstanding debt in the market. The Chicago lodging market was hampered by oversupply issues pre-pandemic and the onset of COVID-19 exacerbated poor financial performance for a good portion of inventory. Below is a list of 5 specially serviced assets located in the Chicago MSA that have not yet reported updated appraisals. Three of the properties are located in Schaumburg, IL, indicating that the market’s distress is not solely isolated to the CBD.

Property NameAddressOutstanding Balance
(millions)		DQ StatusCRED iQ Base-Case Value
(millions)		Most Recent Appraisal
(millions)		Most Recent Appraisal Date
Residence Inn Schaumburg1610 McConnor Pkwy
Schaumburg, IL 60173		$14.5Current$14.8$18.010/1/2017
Courtyard Schaumburg1311 American Ln
Schaumburg, IL 60173		$13.8Current$14.4$17.210/1/2017
Springhill Suites Schaumburg1550 McConnor Pkwy
Schaumburg, IL 60172		$9.6Current$9.2$11.910/1/2017
Best Western O’Hare10300 W Higgins Rd
Rosemont, IL 60018		$8.9121+ Days$8.2$8.79/11/2020
Holiday Inn – Chicago2424 W Sullivan Rd
Aurora, IL 60506		$5.3121+ Days$4.0$3.38/27/2020
Source: CRED iQ

Los Angeles

The Los Angeles-Long Beach-Santa Ana, CA MSA has approximately $1.05 billion in distressed lodging CMBS debt; however, this accounts for only about 25% of total outstanding debt in the market, which is the lowest percentage of the 5 markets that are featured. There are 5 distressed assets presented below that have transferred to special servicing but have not yet reported updated appraisals. Despite the relatively high balance of distressed debt in the market, Los Angeles has been one of the more active markets where commercial real estate investors have been finding opportunities. Several notable lodging assets have been sold so far in 2021, including the two properties located in Orange, CA in the list below. Both of the mortgage loans were assumed in conjunction with the sales.

Property NameAddressOutstanding Balance
(millions)		DQ StatusCRED iQ Base-Case Value
(millions)		Most Recent Appraisal (millions)Most Recent Appraisal Date
Courtyard Los Angeles Sherman Oaks15433 Ventura Blvd
Sherman Oaks, CA 91403		$54.5121+ Days$51.1$48.78/8/2020
DoubleTree Anaheim – Orange County100 The City Drive S
Orange, CA 92868		$45.1121+ Days$68.6$64.18/20/2020
Embassy Suites – Brea900 E Birch St
Brea, CA 92821		$37.4121+ Days$53.2$53.011/17/2020
Portofino Inn & Suites – Anaheim CA1831 S Harbor Blvd
Anaheim, CA 92802		$36.8REO$30.1$34.54/25/2018
Embassy Suites Anaheim Orange400 N State College Blvd
Orange, CA 92868		$33.0Current$48.5$58.74/1/2018
Source: CRED iQ

Houston

The Houston-Sugar Land-Baytown, TX MSA has approximately $715.9 million in distressed lodging CMBS debt, accounting for nearly 60% of total outstanding lodging debt in the market. Similar to Chicago, a portion of Houston’s distressed lodging inventory was in existence pre-pandemic. In contrast, many submarkets in Houston, such as Westchase and the Energy Corridor, were impacted by volatility in the oil and gas industries and ongoing operational repercussions have lingered. A snapshot of distressed lodging properties in the Houston market is shown below.

Property NameAddressOutstanding Balance
(millions)		DQ StatusCRED iQ Base-Case Value
(millions)		Most Recent Appraisal
(millions)		Most Recent Appraisal Date
Hilton Houston Westchase9999 Westheimer Road
Houston, TX 77042		$42.1Maturity Default$17.8$22.25/20/2020
Marriott Galleria1750 W Loop S
Houston, TX 77027		$29.8REO$21.1$21.09/17/2020
Hilton Garden Inn Houston7979 Willow Chase Blvd
Houston, TX 77070		$18.4REO$8.9$12.59/10/2020
Courtyard Galveston9550 Seawall Blvd
Galveston, TX 77554		$7.3REO$9.2$7.99/18/2020
Holiday Inn Houston SW Sugar Land11160 Southwest Fwy
Houston, TX 77031		$7.3121+ Days$5.0$9.57/23/2020
Source: CRED iQ

Portland

The Portland-Vancouver-Beaverton, OR-WA MSA has approximately $537.1 million in distressed CMBS debt secured by hotels. Portland had the second highest rate of lodging distress among CRED iQ’s Top 50 markets, with 61% of loans secured by hotels that are either specially serviced or delinquent. There are 3 assets, listed below, located in the Portland MSA that are distressed but have not received updated appraisals for about a year.


Property Name		AddressOutstanding Balance
(millions)		DQ StatusCRED iQ Base-Case Value
(millions)		Most Recent Appraisal
(millions)		Most Recent Appraisal Date
Embassy Suites – Hillsboro20001 NW Tanasbourne Dr
Hillsboro, OR 97124		$30.1Current$21.2$33.09/18/2020
Hotel deLuxe729 SW 15th Avenue
Portland, OR 97205		$29.2121+ Days$28.3$33.09/1/2020
Comfort Inn and Suites – McMinnville2520 SE Stratus Ave
McMinnville, OR 97128		$4.1Current$6.7$7.77/28/2020
Source: CRED iQ

CRED iQ is a commercial real estate data, analytics, and valuation platform providing actionable intelligence to CRE and capital markets investors. Subscribers to CRED iQ use the platform to identify valuable leads for leasing, lending, refinancing, distressed debt, and acquisition opportunities. For full access to our loan database and valuation platform, sign up for a free trial below:

FREE TRIAL

CRED iQ in the News – Regional Mall Distress

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CRED iQ
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A great article was published on MarketWatch this week by @JoyWiltermuth profiling buyers of distressed regional malls across the country. For those of our followers that missed the story, here is a link to the article. CRED iQ had the pleasure of providing data for regional malls that have become distressed to the level that the owners have or are willing to transition titles to the properties back to lenders. This group of assets includes malls that have become REO since the pandemic, malls that have entered receivership, malls in negotiation for deed-in-lieu of foreclosure agreements, and malls where foreclosure is likely in the near term.

Here is a list of the 5 largest malls that have become REO since the onset of the pandemic:

REO Title Acquisitions Since April 2020 – Regional Malls

Property NameLocationOutstanding Debt
Town Center at CobbKennesaw, GA$173,449,158
Florence MallFlorence, KY$89,404,415
Southland MallCutler Bay, FL$65,159,858
Newgate MallOgden, UT$58,000,000
Oakdale MallJohnson City, NY$47,464,494

More additions to the list are likely to occur over the next 12 to 18 months as foreclosures and deed-in-lieu agreements continue to be consummated. Here is a sample list of some of the largest loans that are on the path to foreclosure and subsequent title transfer:

Likely Near Term REO Title Transfers – Regional Malls

Property NameLocationOutstanding Debt
Mall St. MatthewsLouisville, KY$164,710,290
Park Place MallTucson, AZ$164,332,652
Westfield Citrus ParkTampa, FL$123,939,920
Ingram Park MallSan Antonio, TX$120,157,888
Mall at Tuttle CrossingDublin, OH$111,961,149

To explore the data more in depth, click here.

Recent Commercial Mortgage Originations

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CRED iQ
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This week, CRED iQ took the opportunity to highlight newly originated commercial real estate loans and calculated real-time valuations for 5 properties that have secured financing in recent months. Our data and analysis indicate these loans have relatively elevated levels of credit risk compared to others originated so far in 2021. CRED iQ valuations factor in a base-case (Most Likely), a downside (significant loss of tenants), and dark scenarios (100% vacant). For full access to the valuation reports as well as full CMBS loan reporting, including detailed financials, updated tenant information, and borrower contact information, sign up for a free trial here.

Mi Place at Vineyard

288 units, Multifamily, Lewes, DE 19958

A $49.0 million financing package was funded by Morgan Stanley on July 13, 2021. The debt stack consisted of a $44.0 million first mortgage loan and $5.0 million in mezzanine debt. The financing package was used to pay off $39.2 million in existing debt and return $8.2 million in equity to the borrower sponsor, Jeffrey Fernbach, founder of Fernmoor Homes. The mortgage loan has a 10-year term and requires interest-only debt service payments with an interest rate of 4.37%. The mezzanine loan is coterminous with the senior mortgage and requires interest-only payments with rate of 9.25%. The mezzanine loan appears to have been sold to a third party, while the senior debt was securitized in a CMBS transaction.

The mortgage loan is secured by a leasehold interest in several multifamily and commercial condominium units located in Lewes, DE, about 8 miles inland of the Atlantic Ocean and Delaware’s coastline. The property contains 288 apartment units and an additional 21 units for commercial use. The collateral operates pursuant to a ground lease that required a payment of $992,805 in 2021. The ground lease expires in 2102 and annual payment is calculated based on formulas that account for a percentage of apartment rents for certain units and a flat cost per size for other units, with increases based on the consumer price index. The property was appraised for $64.1 million, equal to $222,569/unit, in March 2021; although CRED iQ’s analysis suggests a slightly lower value, accounting for credit risks associated with property’s leasehold ownership interest and certain elements of the condominium structure. For the full valuation report and loan-level details, click here.

Subject Property
NameMi Place at Vineyard
Address12001 Old Vine Boulevard
Lewes, Delaware 19958
TypeMultifamily
SubtypeGarden
Building Size288 units
Year Built2012
SubmarketLewes
CountySussex County
MSANon-Metropolitan Area – DE
Origination Date07/13/2021
Valuation
Appraisal Value$64,100,000
Appraisal Date03/16/2021
MyQ Concluded Value $60,450,000

Crescent Shopping Center

118,038 sf, Neighborhood Center, Austin, TX 78752

A $24.5 million loan was originated by Morgan Stanley on April 6, 2021 to refinance existing debt on a 118,000-sf retail property located in suburban Austin, TX. The 10-year loan has an interest rate of 4.36% and is structured with a 5-year interest-only period. After June 2026, the loan will require amortizing debt service payments based on a 30-year schedule. The loan is secured by a leasehold interest in a retail property anchored by grocer 99 Ranch Market with a 37,239-sf lease that expires in July 2032, 14 months after loan maturity. No other in-line tenant accounts for more than 7,500 sf of the property’s GLA. The retail center operates under two ground leases with The Board of Regents of The University of Texas System that require a base rent of approximately $245,000 plus 7% of adjusted gross revenues. The ground leases expire in January 2029 but have 3, 10-year extensions through January 2050. The property was appraised for $38.7 million, equal to $328/sf, as of February 4, 2021, which implies a capitalization rate of 4.51% based on the originator’s underwritten net cash flow. CRED iQ’s analysis factors in additional risk related to the ground lease as well as heavy reliance on restaurant tenants occupying the in-line suites. For the full valuation report and loan-level details, click here.

Subject Property
NameCrescent Shopping Center
Address6903 Airport Boulevard
Austin, TX 78752
TypeRetail
SubtypeAnchored
Building Size118,038 sf
Year Built1964
SubmarketHighland
CountyTravis County
MSAAustin-Round Rock, TX MSA
Origination Date04/06/2021
Valuation
Appraisal Value$38,700,000
Appraisal Date02/04/2021
MyQ Concluded Value$33,080,000

200 South Virginia Street

118,844 sf, CBD Office, Reno, NV 89501

Basin Street Properties secured a $15.9 million loan, originated by Bank of America, on June 2, 2021 to refinance existing debt on a 119,000-sf nine-story office building located in downtown Reno, NV. The loan was structured with an interest rate of 3.62% and has a 10-year term. The office tower was 87% occupied as of March 16, 2021 but the loan was underwritten by the originator assuming occupancy of 84%. Several large tenants at the property have lease expirations within the next 3 years. Co-working operator Regus is the largest tenant, accounting for 14% of the GLA, and has a lease that expires in September 2024. The third-largest tenant, Breadware Inc., has a lease accounting for 6% of the GLA that expires in February 2023. The property was appraised for $26.7 million, equal to $225/sf, as of April 2021, which implied a capitalization rate of 5.88% based on the originator’s underwritten net cash flow. CRED iQ’s analysis indicates moderate concern regarding the tenant roster over the loan’s term but our valuation is in line with the most recent appraisal given the assumption that the property can improve occupancy to be greater than 90%. For the full valuation report and loan-level details, click here.

Subject Property
Name200 South Virginia Street
Address200 South Virginia Street
Reni, Nevada 89501
TypeOffice
SubtypeCBD
Building Size118,844 sf
Year Built1982
SubmarketDowntown
CountyWashoe County
MSAReno-Sparks, NV MSA
Origination Date06/02/2021
Valuation
Appraisal Value$26,700,000
Appraisal Date04/06/2021
MyQ Concluded Value$25,250,000

Home Depot Warehouse

310,316 sf, Warehouse, Mexico, MO 65265

A $9.95 million loan was originated by Morgan Stanley on April 15, 2021 to facilitate the acquisition of a 310,000-sf single-tenant warehouse by the borrower sponsor, Ilan Goldstein. The 10-year loan has an interest rate of 4.85% and was structured to require amortizing debt service payments based on a 30-year schedule. The collateral property is located in rural Missouri along US Route 54, across the road from Mexico Airport. The property is leased to Home Depot through October 31, 2027, which is 3 and a half years prior to loan maturity on May 1, 2031. The lease expiration of the single tenant adds a layer of binary risk to the loan; however, the property is connected to a facility also operated by Home Depot that shares a joint inventory system. The property was appraised for $14.5 million, equal to $47/sf, in November 2020, which implied a capitalization rate of 5.80% based on the originator’s underwritten net cash flow. CRED iQ’s valuation is based on a 75% probability of lease renewal by Home Depot at lease expiration. For the full valuation report and loan-level details, click here.

Subject Property
NameHome Depot Warehouse
Address5701 U.S. 54 Business
Mexico, Missouri 65265
TypeIndustrial
SubtypeWarehouse
Building Size310,316 sf
Year Built1985
SubmarketMexico
CountyAudrain County
MSANon-Metropolitan Area – MO
Origination Date04/15/2021
Valuation
Appraisal Value$14,500,000
Appraisal Date11/20/2020
MyQ Concluded Value$12,620,000

Valley Forge Corporate Center

65,716 sf, Suburban Office, Audubon, PA 19403

An $8.97 million loan was originated by KeyBank on February 9, 2021 to refinance existing debt on a 66,000-sf office property located in suburban Philadelphia, PA. The loan was structured with a partial-term interest-only period of 2 years before it converts to amortizing payments. The loan’s monthly debt service amount will increase on April 1, 2023, which coincides with the start of a period of high lease rollover risk for the property. All 5 of the office building’s largest tenants have lease expirations prior to the loan’s maturity date in March 2031. The property’s largest tenant, American Regent, accounts for 35% of the GLA and has a lease expiration on August 31, 2025. Additionally, American Regent has a lease termination option for any time after August 31, 2023, which is five months after interest-only expiration. The second-largest tenant, Assurance Software, Inc, accounts for 27% of the GLA and has a lease expiration of April 30, 2025. The property was 90% occupied at the beginning of 2021. A January 1, 2021 appraisal valued the office center at $13.8 million, equal to $210/sf, which implied a capitalization rate of 6.40% based on the originator’s underwritten NCF. However, CRED iQ’s analysis factored in potentially significant leasing costs in years 2023 through 2026. For additional information, including borrower contacts, please reach out to our team. For the full valuation report and loan-level details, click here.

Subject Property
NameValley Forge Corporate Center
Address800 Adams Avenue
Audubon, Pennsylvania 19403
TypeOffice
SubtypeSuburban
Building Size65,716 sf
Year Built2008
SubmarketNorristown
CountyMontgomery County
MSAPhiladelphia-Camden-Wilmington, PA-NJ-DE-MD MSA
Origination Date02/09/2021
Valuation
Appraisal Value$13,800,000
Appraisal Date01/01/2021
MyQ Concluded Value$11,920,000

CRED iQ is a commercial real estate data, analytics, and valuation platform providing actionable intelligence to CRE and capital markets investors. Subscribers to CRED iQ use the platform to identify valuable leads for leasing, lending, refinancing, distressed debt, and acquisition opportunities. For full access to our loan database and valuation platform, sign up for a free trial below:

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Distressed Opportunities – Cleveland

By
CRED iQ
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0

This week, CRED iQ continued to focus on distressed commercial real estate collateral located in Cleveland, OH and calculated real-time valuations for 5 properties within the MSA that have recently transferred to special servicing, including the tallest building in the state of Ohio. The August 2021 CRED DQ Report highlighted Cleveland as a market with one of the three-highest delinquency rates in the US, which opened the opportunity to take a deeper dive into a few of the assets behind the elevated level of distress. The CRED iQ valuations factor in a base-case (Most Likely), a downside (significant loss of tenants), and dark scenarios (100% vacant). For full access to the valuation reports as well as full CMBS loan reporting, including detailed financials, updated tenant information, and borrower contact information, sign up for a free trial here.

Key Center Cleveland

(Key Tower/Marriott Cleveland Downtown/Key Center Parking Garage)

1.4 million sf/400 keys/985 spaces, Mixed-Use (Office/Hotel/Parking), Cleveland, OH 44114

This $209.5 million loan transferred to special servicing in October 2020 due to imminent monetary default, which the borrower attributed to adverse impacts from COVID-19. The loan is secured by fee interests in a 1.4 million-sf Class-A office tower (Key Tower) and a 400-key hotel (Marriott Cleveland Downtown) as well a leasehold interest in a 985-space subterranean parking garage located under the adjacent Memorial Fountain (Key Center Parking Garage). All three structures are located in the CBD of Cleveland, on the northern corner of Cleveland Public square.

On an aggregate basis, net cash flow for the properties declined from $28.9 million in 2019 to $21.0 million in 2020, resulting in a DSCR of 1.32. However, the DSCR is below breakeven when factoring in $42.5 million of mezzanine debt, which was funded by Apollo Commercial Real Estate Finance. The decline in net cash flow during 2020 was primarily caused by a loss of revenue from the hotel and parking components of the collateral during the early stages of the pandemic. Base rents from the office component remained stable in 2020; although, servicer commentary noted the building’s namesake tenant, Key Bank, contracted its space by about 42,000 sf. Key Bank now leases about 18% of the property’s GLA and still has two more contraction options in the coming years, totaling about 60,000 sf.

Despite the distressed nature of the loan, the office tower remains well-positioned in the submarket. Reserves for the loan, including funds for leasing, are relatively healthy, totaling $10.5 million and CRED iQ has observed other tenants in the submarket vacate inferior properties in favor of Key Tower. Just last week, our WAR Report highlighted law firm Littler Mendelson vacating 1100 Superior Avenue to move into Key Tower. The borrower appears to be requesting temporary payment relief, as evidenced by servicer commentary. For the full valuation report and loan-level details, click here.

DoubleTree by Hilton – Cleveland OH

379 keys, Full-Service Hotel, Cleveland, OH 44114

This $26.6 million loan transferred to special servicing in October 2019 due to monetary default. The loan is secured by a full-service hotel that operates as a DoubleTree by Hilton via a franchise agreement that expires in November 2026. As a pre-pandemic transfer, the property’s operational struggles can be traced back to competition from newer, higher quality lodging projects in the CBD submarket, including the 600-key Hilton Cleveland Downtown. The borrower appears to have been cooperating with the placement of a receiver and attempted transition of the title to Greystone, the loan’s special servicer. However, a foreclosure moratorium in 2020 and ongoing labor issues with hotel employees have delayed a title transfer, which may make a note sale more plausible as a workout solution. For the full valuation report and loan-level details, click here.

DoubleTree Beachwood

404 keys, Full-Service Hotel, Beachwood, OH 44122

This distressed hotel opportunity has outstanding debt of $24.1 million and has been with the special servicer since April 2019. The property is a 404-key full-service hotel, and similar to the property highlighted above, operates as a DoubleTree by Hilton via a franchise agreement that expires in 2027. Torchlight, as special servicer, acquired title to the property on December 4, 2020 via a deed-in-lieu of foreclosure agreement. Our analysis indicates that the lodging facility is configured with an excessive quantity of rooms for its market, which has been a main driver behind the property’s operational struggles as well as an onerous franchise fee that has been reported to be over $1.1 million. Updated commentary indicates the property is actively being marketed for sale. For the full valuation report and loan-level details, click here.

Flats East Bank Phase I

150 keys, Mixed-Use (Hotel/Retail), Cleveland, OH 44113

This $22.7 million loan transferred to special servicing on June 1, 2020 due to imminent monetary default. The loan is secured by a mixed-use property that includes a 150-key hotel, 33,166 sf of retail space and a 174-space parking lot. The hotel operates under a franchise agreement with Sheraton’s Aloft brand that expires in June 2033. This Phase I property is part of a larger multi-phase development that includes other distressed properties as well. Phase II of the development, which included multifamily and retail uses, was also distressed in early 2021, but the mortgage loan secured by Phase II was ultimately purchased by a subordinate debtholder.

The Phase I property began having issues in 2017 when the largest retail tenant, EB Fitness, vacated its 16,071-sf suite. A new fitness tenant, Browns Fit, signed a lease to occupy the vacant space in 2019. Shortly after, the effects of COVID-19 began to take its toll on the property, especially the hotel component. The latest servicer commentary indicated Rialto, as special servicer, is in workout negotiations with the borrower. The viability of the hotel component is a key factor for the property because it has a deed restriction related to past environmental issues that prohibits residential use. For the full valuation report and loan-level details, click here.

The IMG Building

232,908 sf, Office, Cleveland, OH 44114

This $16.2 million loan transferred to special servicing on March 5, 2019 due to delinquency. The loan is secured by a Class-C office property, located in the shadow of One Cleveland Center within the CBD of Cleveland. The borrower has not provided updated occupancy or financial figures since loan origination; however, CRED iQ estimates current occupancy to be approximately 68%. According to Crain’s Cleveland Business, the property’s second largest tenant, MAI Capital Management, is vacating in favor of a suburban office location. Additionally, the third-largest tenant Bellwether Enterprise moved across the street to the aforementioned One Cleveland Center. The two tenants accounted for 20% of the property’s GLA. The servicer has filed for foreclosure and the borrower is contesting those actions. For the full valuation report and loan-level details, click here.

CRED iQ is a commercial real estate data, analytics, and valuation platform providing actionable intelligence to CRE and capital markets investors. Subscribers to CRED iQ use the platform to identify valuable leads for leasing, lending, refinancing, distressed debt, and acquisition opportunities. For full access to our loan database and valuation platform, sign up for a free trial below:

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August 2021 Delinquency Report

By
CRED iQ
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0

The overall delinquency rate declined this month and continued a streak of downward movement since its peak in June 2020. The month-over-month improvement compared to the prior period is attributed to the lodging sector. Hotel properties continue to be a primary source distressed commercial real estate with the highest overall delinquency rate by property type; however, delinquencies in the sector continue to be resolved throughout the summer months, in turn bringing down the overall delinquency rate. The Cleveland, OH lodging market is an example month-over-month delinquency improvement, second-highest this month, despite nearly half of its lodging inventory still considered distressed. Markets with the highest month-over-month increases in delinquency for lodging properties included Birmingham, AL, Baltimore, MD and Los Angeles, CA. Implications from emerging concerns about the Delta variant of COVID-19 remain to be seen as select markets revert back to certain restrictions that may adversely impact commercial real estate collateral.

CRED iQ monitors market performance for nearly 400 MSAs across the United States. Below is a summary of the default rates for the 50 largest metros segmented by property type. For these 50 MSAs, the highest delinquency rate was in Minneapolis, followed by Louisville and Cleveland. The San Francisco market saw the largest month-over-month increase in delinquency, although the spike was isolated to the 3,221-unit Parkmerced multifamily community. Accounting for the outlier, Louisville had the next highest increase in delinquency compared to the prior month. Sacramento, CA and Allentown, PA both reported the lowest delinquency rate among the Top 50 MSAs. The most significant month over-month decline in delinquency was in the Tucson market, which has seen volatile fluctuations in delinquency rates throughout the year.

For the full report, download here:

The-CRED-DQ-Report-August-2021-1Download

By property type, the hotel and retail sectors remain the largest contributors to the delinquency percentages for the majority of these statistical areas. Loans backed by self-storage, multifamily, and industrial facilities posted the lowest delinquency rates for most of these markets.

Delinquent & Specially Serviced Loans by MSA and Property Type

MSA – Property Type DQ/SS (millions)DQ/SS (%)Monthly Change
Allentown-Bethlehem-Easton, PA-NJ MSA$19.50.6%-0.01%
Allentown – Hotel$0.00.0%0.00%
Allentown – Industrial$0.00.0%0.00%
Allentown – Multifamily$0.00.0%0.00%
Allentown – Office$0.00.0%0.00%
Allentown – Other$0.00.0%0.00%
Allentown – Retail$19.55.1%0.00%
Allentown – Self Storage$0.00.0%0.00%
Atlanta – Atlanta-Sandy Springs-Marietta, GA MSA$749.13.1%-0.18%
Atlanta – Hotel$248.113.0%-0.55%
Atlanta – Industrial$0.00.0%0.00%
Atlanta – Multifamily$1.60.0%0.00%
Atlanta – Office$34.11.2%0.03%
Atlanta – Other$0.00.0%0.00%
Atlanta – Retail$465.317.1%-1.42%
Atlanta – Self Storage$0.00.0%0.00%
Austin – Austin-Round Rock, TX MSA$527.75.4%-0.36%
Austin – Hotel$419.444.7%-2.88%
Austin – Industrial$0.00.0%0.00%
Austin – Multifamily$0.00.0%0.00%
Austin – Office$0.00.0%0.00%
Austin – Other$0.00.0%0.00%
Austin – Retail$105.812.3%1.60%
Austin – Self Storage$2.52.1%2.10%
Baltimore – Baltimore-Towson, MD MSA$458.84.7%0.13%
Baltimore – Hotel$145.130.7%2.61%
Baltimore – Industrial$0.00.0%0.00%
Baltimore – Multifamily$2.20.0%0.00%
Baltimore – Office$16.92.7%0.27%
Baltimore – Other$0.00.0%0.00%
Baltimore – Retail$294.626.5%-0.15%
Baltimore – Self Storage$0.00.0%0.00%
Birmingham – Birmingham-Hoover, AL MSA$45.71.8%-0.64%
Birmingham – Hotel$22.721.4%3.47%
Birmingham – Industrial$0.00.0%0.00%
Birmingham – Multifamily$0.00.0%0.00%
Birmingham – Office$0.00.0%-4.94%
Birmingham – Other$0.00.0%0.00%
Birmingham – Retail$23.03.2%-0.02%
Birmingham – Self Storage$0.00.0%0.00%
Boston – Boston-Cambridge-Quincy, MA-NH MSA$390.12.2%-0.03%
Boston – Hotel$98.712.8%-0.13%
Boston – Industrial$0.00.0%0.00%
Boston – Multifamily$0.00.0%0.00%
Boston – Office$0.00.0%0.00%
Boston – Other$0.00.0%0.00%
Boston – Retail$291.314.7%-0.57%
Boston – Self Storage$0.00.0%0.00%
Bridgeport – Bridgeport-Stamford-Norwalk, CT MSA$263.96.6%-0.75%
Bridgeport – Hotel$63.851.3%-24.04%
Bridgeport – Industrial$17.812.9%0.00%
Bridgeport – Multifamily$0.00.0%0.00%
Bridgeport – Office$135.711.0%-1.21%
Bridgeport – Other$23.65.8%-0.98%
Bridgeport – Retail$22.96.4%0.00%
Bridgeport – Self Storage$0.00.0%0.00%
Charlotte – Charlotte-Gastonia-Concord, NC-SC MSA$354.54.2%-0.10%
Charlotte – Hotel$139.59.1%-0.37%
Charlotte – Industrial$0.00.0%0.00%
Charlotte – Multifamily$0.00.0%0.00%
Charlotte – Office$21.32.5%-0.10%
Charlotte – Other$85.023.3%0.29%
Charlotte – Retail$108.77.8%-0.84%
Charlotte – Self Storage$0.00.0%0.00%
Chicago – Chicago-Naperville-Joliet, IL-IN-WI MSA$2,111.67.8%0.00%
Chicago – Hotel$1,117.149.3%-1.19%
Chicago – Industrial$4.20.2%0.00%
Chicago – Multifamily$122.41.3%-0.10%
Chicago – Office$400.15.5%0.47%
Chicago – Other$117.95.8%-0.14%
Chicago – Retail$349.99.9%0.01%
Chicago – Self Storage$0.00.0%0.00%
Cincinnati – Cincinnati-Middletown, OH-KY-IN MSA$317.28.5%-0.23%
Cincinnati – Hotel$141.446.3%-0.42%
Cincinnati – Industrial$0.00.0%0.00%
Cincinnati – Multifamily$0.00.0%0.00%
Cincinnati – Office$11.62.4%-0.14%
Cincinnati – Other$15.85.1%-0.64%
Cincinnati – Retail$147.620.7%-0.04%
Cincinnati – Self Storage$1.01.6%1.57%
Cleveland – Cleveland-Elyria-Mentor, OH MSA$575.713.6%1.02%
Cleveland – Hotel$113.949.6%-9.48%
Cleveland – Industrial$0.00.0%0.00%
Cleveland – Multifamily$0.00.0%0.00%
Cleveland – Office$105.512.6%5.29%
Cleveland – Other$161.936.7%3.53%
Cleveland – Retail$194.420.2%-0.21%
Cleveland – Self Storage$0.00.0%0.00%
Columbus, OH – Columbus, OH MSA$235.83.9%0.12%
Columbus, OH – Hotel$84.826.5%0.22%
Columbus, OH – Industrial$0.00.0%0.00%
Columbus, OH – Multifamily$4.30.1%0.00%
Columbus, OH – Office$8.11.5%0.00%
Columbus, OH – Other$0.00.0%0.00%
Columbus, OH – Retail$128.314.9%-1.83%
Columbus, OH – Self Storage$10.417.8%17.84%
Dallas – Dallas-Fort Worth-Arlington, TX MSA$1,000.13.0%0.08%
Dallas – Hotel$460.812.7%0.21%
Dallas – Industrial$1.70.1%0.00%
Dallas – Multifamily$47.70.2%0.24%
Dallas – Office$154.44.2%-0.13%
Dallas – Other$23.91.6%-0.02%
Dallas – Retail$300.311.5%-1.19%
Dallas – Self Storage$11.22.1%2.13%
Denver – Denver-Aurora, CO MSA$339.42.0%0.04%
Denver – Hotel$43.45.0%-0.21%
Denver – Industrial$0.00.0%0.00%
Denver – Multifamily$0.00.0%0.00%
Denver – Office$194.79.5%0.33%
Denver – Other$7.01.2%-0.20%
Denver – Retail$91.25.9%-0.01%
Denver – Self Storage$3.11.8%1.80%
Detroit – Detroit-Warren-Livonia, MI MSA$575.56.4%-0.08%
Detroit – Hotel$316.941.6%-0.08%
Detroit – Industrial$40.67.5%-0.06%
Detroit – Multifamily$18.50.6%0.00%
Detroit – Office$0.00.0%0.00%
Detroit – Other$22.53.4%-0.09%
Detroit – Retail$177.010.2%-0.18%
Detroit – Self Storage$0.00.0%0.00%
Hartford – Hartford-West Hartford-East Hartford, CT MSA$227.69.3%-0.07%
Hartford – Hotel$95.964.2%-0.07%
Hartford – Industrial$0.00.0%0.00%
Hartford – Multifamily$11.10.8%-0.01%
Hartford – Office$87.622.2%0.02%
Hartford – Other$1.20.5%-0.01%
Hartford – Retail$31.813.0%-0.23%
Hartford – Self Storage$0.00.0%0.00%
Houston – Houston-Sugar Land-Baytown, TX MSA$1,522.16.1%0.02%
Houston – Hotel$715.960.0%-0.02%
Houston – Industrial$6.61.0%-0.06%
Houston – Multifamily$105.80.8%-0.04%
Houston – Office$525.714.3%-0.37%
Houston – Other$32.43.9%-0.30%
Houston – Retail$107.62.8%-0.05%
Houston – Self Storage$28.25.6%5.61%
Indianapolis – Indianapolis-Carmel, IN MSA$402.58.8%0.57%
Indianapolis – Hotel$169.526.6%-1.40%
Indianapolis – Industrial$0.00.0%0.00%
Indianapolis – Multifamily$97.24.7%1.53%
Indianapolis – Office$72.611.2%-0.01%
Indianapolis – Other$9.84.8%0.00%
Indianapolis – Retail$49.49.2%0.05%
Indianapolis – Self Storage$4.05.2%1.74%
Jacksonville – Jacksonville, FL MSA$77.31.5%-0.04%
Jacksonville – Hotel$48.211.1%-0.27%
Jacksonville – Industrial$0.00.0%0.00%
Jacksonville – Multifamily$20.00.6%0.00%
Jacksonville – Office$0.00.0%0.00%
Jacksonville – Other$0.00.0%0.00%
Jacksonville – Retail$9.12.1%0.00%
Jacksonville – Self Storage$0.00.0%0.00%
Kansas City – Kansas City, MO-KS MSA$199.74.2%-0.31%
Kansas City – Hotel$150.747.7%-3.88%
Kansas City – Industrial$0.00.0%0.00%
Kansas City – Multifamily$7.60.3%0.00%
Kansas City – Office$0.00.0%0.00%
Kansas City – Other$2.82.1%-0.42%
Kansas City – Retail$37.05.8%-2.27%
Kansas City – Self Storage$1.60.8%0.76%
Las Vegas – Las Vegas-Paradise, NV MSA$387.21.9%-0.08%
Las Vegas – Hotel$18.30.3%-0.01%
Las Vegas – Industrial$0.00.0%0.00%
Las Vegas – Multifamily$0.00.0%0.00%
Las Vegas – Office$10.21.6%-0.09%
Las Vegas – Other$0.00.0%0.00%
Las Vegas – Retail$356.07.3%-0.36%
Las Vegas – Self Storage$2.61.3%1.31%
Los Angeles – Los Angeles-Long Beach-Santa Ana, CA MSA$2,422.04.9%0.29%
Los Angeles – Hotel$1,055.024.9%2.82%
Los Angeles – Industrial$2.00.2%-0.01%
Los Angeles – Multifamily$125.40.6%-0.01%
Los Angeles – Office$375.13.1%-0.01%
Los Angeles – Other$212.06.4%0.02%
Los Angeles – Retail$652.49.3%0.29%
Los Angeles – Self Storage$0.00.0%0.00%
Louisville – Louisville/Jefferson County, KY-IN MSA$633.720.3%2.33%
Louisville – Hotel$243.054.1%-0.55%
Louisville – Industrial$0.00.0%0.00%
Louisville – Multifamily$3.80.3%0.00%
Louisville – Office$0.00.0%0.00%
Louisville – Other$0.00.0%0.00%
Louisville – Retail$386.959.0%10.97%
Louisville – Self Storage$0.00.0%0.00%
Memphis – Memphis, TN-AR-MS MSA$200.38.1%0.05%
Memphis – Hotel$56.427.3%-2.19%
Memphis – Industrial$0.00.0%0.00%
Memphis – Multifamily$17.81.7%0.07%
Memphis – Office$43.311.4%0.65%
Memphis – Other$18.431.9%-3.76%
Memphis – Retail$62.815.3%-0.62%
Memphis – Self Storage$1.61.0%1.00%
Miami – Miami-Fort Lauderdale-Pompano Beach, FL MSA$913.84.2%0.30%
Miami – Hotel$359.07.8%-0.04%
Miami – Industrial$0.00.0%0.00%
Miami – Multifamily$8.50.1%0.02%
Miami – Office$26.41.3%-0.06%
Miami – Other$71.04.8%4.14%
Miami – Retail$448.89.1%-0.20%
Miami – Self Storage$0.00.0%0.00%
Milwaukee – Milwaukee-Waukesha-West Allis, WI MSA$255.810.5%-0.11%
Milwaukee – Hotel$35.723.1%-0.01%
Milwaukee – Industrial$0.00.0%0.00%
Milwaukee – Multifamily$0.00.0%0.00%
Milwaukee – Office$66.511.6%-1.58%
Milwaukee – Other$0.00.0%0.00%
Milwaukee – Retail$153.529.9%0.78%
Milwaukee – Self Storage$0.00.0%0.00%
Minneapolis – Minneapolis-St. Paul-Bloomington, MN-WI MSA$1,943.723.3%-0.57%
Minneapolis – Hotel$332.652.3%-0.23%
Minneapolis – Industrial$15.15.4%-1.73%
Minneapolis – Multifamily$0.00.0%-0.19%
Minneapolis – Office$152.57.4%-0.47%
Minneapolis – Other$11.72.8%1.67%
Minneapolis – Retail$1,431.869.8%0.03%
Minneapolis – Self Storage$0.00.0%0.00%
Nashville – Nashville-Davidson-Murfreesboro-Franklin, TN MSA$356.65.7%0.56%
Nashville – Hotel$344.524.7%2.20%
Nashville – Industrial$0.00.0%0.00%
Nashville – Multifamily$0.00.0%0.00%
Nashville – Office$0.00.0%0.00%
Nashville – Other$0.00.0%0.00%
Nashville – Retail$12.11.6%0.30%
Nashville – Self Storage$0.00.0%0.00%
New Orleans – New Orleans-Metairie-Kenner, LA MSA$452.913.3%-1.52%
New Orleans – Hotel$416.638.5%-3.55%
New Orleans – Industrial$0.00.0%0.00%
New Orleans – Multifamily$13.41.7%0.02%
New Orleans – Office$0.00.0%0.00%
New Orleans – Other$0.00.0%0.00%
New Orleans – Retail$22.92.9%-0.24%
New Orleans – Self Storage$0.00.0%0.00%
New York City – New York-Northern New Jersey-Long Island, NY-NJ-PA MSA$6,299.65.1%-0.49%
New York City – Hotel$1,872.150.1%0.26%
New York City – Industrial$7.50.4%0.00%
New York City – Multifamily$457.91.1%-0.19%
New York City – Office$547.51.3%-1.37%
New York City – Other$1,587.87.5%0.35%
New York City – Retail$1,826.812.8%-0.43%
New York City – Self Storage$0.00.0%0.00%
Orlando – Orlando-Kissimmee, FL MSA$555.24.7%-0.37%
Orlando – Hotel$243.38.4%-4.30%
Orlando – Industrial$0.00.0%0.00%
Orlando – Multifamily$25.50.4%0.00%
Orlando – Office$47.19.6%-0.01%
Orlando – Other$0.00.0%0.00%
Orlando – Retail$239.422.5%-2.04%
Orlando – Self Storage$0.00.0%0.00%
Philadelphia – Philadelphia-Camden-Wilmington, PA-NJ-DE-MD MSA$970.55.1%-0.58%
Philadelphia – Hotel$350.428.9%-2.44%
Philadelphia – Industrial$0.00.0%0.00%
Philadelphia – Multifamily$118.71.3%-0.13%
Philadelphia – Office$47.31.1%-0.09%
Philadelphia – Other$79.45.8%-0.17%
Philadelphia – Retail$374.614.2%-1.76%
Philadelphia – Self Storage$0.00.0%0.00%
Phoenix – Phoenix-Mesa-Scottsdale, AZ MSA$631.53.2%0.63%
Phoenix – Hotel$89.95.4%-0.60%
Phoenix – Industrial$10.21.9%-0.07%
Phoenix – Multifamily$0.00.0%0.00%
Phoenix – Office$53.62.4%1.24%
Phoenix – Other$180.523.6%-0.42%
Phoenix – Retail$297.37.5%0.88%
Phoenix – Self Storage$0.00.0%0.00%
Pittsburgh – Pittsburgh, PA MSA$212.14.5%-0.07%
Pittsburgh – Hotel$150.448.9%0.32%
Pittsburgh – Industrial$0.00.0%0.00%
Pittsburgh – Multifamily$0.00.0%0.00%
Pittsburgh – Office$0.00.0%0.00%
Pittsburgh – Other$8.12.0%0.24%
Pittsburgh – Retail$53.67.1%-0.87%
Pittsburgh – Self Storage$0.00.0%0.00%
Portland – Portland-Vancouver-Beaverton, OR-WA MSA$548.98.3%-0.84%
Portland – Hotel$537.160.9%-0.57%
Portland – Industrial$0.00.0%-3.26%
Portland – Multifamily$10.20.2%-0.27%
Portland – Office$1.60.5%0.49%
Portland – Other$0.00.0%0.00%
Portland – Retail$0.00.0%-3.23%
Portland – Self Storage$0.00.0%0.00%
Raleigh – Raleigh-Cary, NC MSA$175.84.2%0.22%
Raleigh – Hotel$121.226.9%0.00%
Raleigh – Industrial$0.00.0%0.00%
Raleigh – Multifamily$0.00.0%0.00%
Raleigh – Office$12.74.0%0.00%
Raleigh – Other$0.00.0%0.00%
Raleigh – Retail$41.89.4%1.66%
Raleigh – Self Storage$0.00.0%0.00%
Richmond – Richmond, VA MSA$151.94.4%0.25%
Richmond – Hotel$50.717.5%0.00%
Richmond – Industrial$6.95.0%-0.15%
Richmond – Multifamily$9.70.6%0.56%
Richmond – Office$0.00.0%0.00%
Richmond – Other$0.00.0%0.00%
Richmond – Retail$84.515.2%0.11%
Richmond – Self Storage$0.00.0%0.00%
Riverside – Riverside-San Bernardino-Ontario, CA MSA$405.84.5%-0.01%
Riverside – Hotel$94.719.1%0.33%
Riverside – Industrial$0.00.0%0.00%
Riverside – Multifamily$4.50.1%-0.04%
Riverside – Office$0.00.0%0.00%
Riverside – Other$0.00.0%0.00%
Riverside – Retail$306.613.6%0.34%
Riverside – Self Storage$0.00.0%0.00%
Sacramento – Sacramento-Arden-Arcade-Roseville, CA MSA$31.30.6%-0.02%
Sacramento – Hotel$6.31.7%0.00%
Sacramento – Industrial$0.00.0%0.00%
Sacramento – Multifamily$0.00.0%0.00%
Sacramento – Office$6.11.0%-0.20%
Sacramento – Other$0.00.0%0.00%
Sacramento – Retail$18.92.4%0.00%
Sacramento – Self Storage$0.00.0%0.00%
Salt Lake City – Salt Lake City, UT MSA$196.35.3%0.15%
Salt Lake City – Hotel$47.715.3%-0.03%
Salt Lake City – Industrial$0.00.0%0.00%
Salt Lake City – Multifamily$0.00.0%0.00%
Salt Lake City – Office$9.21.8%-0.18%
Salt Lake City – Other$0.00.0%0.00%
Salt Lake City – Retail$139.429.8%5.31%
Salt Lake City – Self Storage$0.00.0%0.00%
San Antonio – San Antonio, TX MSA$181.02.9%0.11%
San Antonio – Hotel$26.27.5%1.45%
San Antonio – Industrial$0.00.0%0.00%
San Antonio – Multifamily$8.20.2%0.00%
San Antonio – Office$0.00.0%0.00%
San Antonio – Other$0.40.5%-0.07%
San Antonio – Retail$144.816.3%-0.13%
San Antonio – Self Storage$1.40.9%0.88%
San Diego – San Diego-Carlsbad-San Marcos, CA MSA$670.26.1%0.12%
San Diego – Hotel$528.124.9%0.71%
San Diego – Industrial$0.00.0%0.00%
San Diego – Multifamily$0.00.0%0.00%
San Diego – Office$0.00.0%0.00%
San Diego – Other$20.93.3%-0.01%
San Diego – Retail$121.310.1%0.14%
San Diego – Self Storage$0.00.0%0.00%
San Francisco – San Francisco-Oakland-Fremont, CA MSA$1,152.25.2%3.64%
San Francisco – Hotel$203.78.6%0.00%
San Francisco – Industrial$0.00.0%0.00%
San Francisco – Multifamily$851.211.8%11.41%
San Francisco – Office$18.90.2%-0.01%
San Francisco – Other$30.61.7%-0.01%
San Francisco – Retail$47.83.6%-0.03%
San Francisco – Self Storage$0.00.0%0.00%
San Jose – San Jose-Sunnyvale-Santa Clara, CA MSA$171.41.2%0.07%
San Jose – Hotel$156.77.6%0.10%
San Jose – Industrial$0.00.0%0.00%
San Jose – Multifamily$0.00.0%0.00%
San Jose – Office$14.70.2%0.23%
San Jose – Other$0.00.0%0.00%
San Jose – Retail$0.00.0%0.00%
San Jose – Self Storage$0.00.0%0.00%
Seattle – Seattle-Tacoma-Bellevue, WA MSA$244.51.5%-0.24%
Seattle – Hotel$237.717.5%-2.87%
Seattle – Industrial$0.00.0%0.00%
Seattle – Multifamily$0.00.0%0.00%
Seattle – Office$0.00.0%-0.03%
Seattle – Other$0.00.0%0.00%
Seattle – Retail$6.80.4%-0.18%
Seattle – Self Storage$0.00.0%0.00%
St. Louis – St. Louis, MO-IL MSA$412.59.4%-0.06%
St. Louis – Hotel$58.720.6%-0.02%
St. Louis – Industrial$0.00.0%0.00%
St. Louis – Multifamily$20.11.2%0.00%
St. Louis – Office$107.619.1%-0.08%
St. Louis – Other$24.74.9%-0.04%
St. Louis – Retail$201.419.5%-0.40%
St. Louis – Self Storage$0.00.0%0.00%
Tampa – Tampa-St. Petersburg-Clearwater, FL$414.84.2%0.07%
Tampa – Hotel$75.06.3%-0.08%
Tampa – Industrial$0.00.0%0.00%
Tampa – Multifamily$34.80.6%0.00%
Tampa – Office$24.14.1%-0.36%
Tampa – Other$0.00.0%0.00%
Tampa – Retail$281.020.5%-5.71%
Tampa – Self Storage$0.00.0%0.00%
Tucson – Tucson, AZ MSA$268.87.4%-1.94%
Tucson – Hotel$1.40.4%0.00%
Tucson – Industrial$0.00.0%0.00%
Tucson – Multifamily$0.00.0%0.00%
Tucson – Office$0.00.0%0.00%
Tucson – Other$0.00.0%0.00%
Tucson – Retail$267.418.3%-20.98%
Tucson – Self Storage$0.00.0%0.00%
Virginia Beach – Virginia Beach-Norfolk-Newport News, VA-NC MSA$260.95.9%0.01%
Virginia Beach – Hotel$38.78.2%1.11%
Virginia Beach – Industrial$21.213.1%-0.93%
Virginia Beach – Multifamily$0.00.0%0.00%
Virginia Beach – Office$12.73.1%-0.40%
Virginia Beach – Other$0.00.0%0.00%
Virginia Beach – Retail$179.519.6%-0.28%
Virginia Beach – Self Storage$8.89.6%0.00%
Washington – Washington-Arlington-Alexandria, DC-VA-MD-WV MSA$927.73.3%-0.15%
Washington – Hotel$59.35.3%-3.16%
Washington – Industrial$0.00.0%0.00%
Washington – Multifamily$4.50.0%0.00%
Washington – Office$442.57.0%-0.07%
Washington – Other$249.712.0%-0.92%
Washington – Retail$171.75.4%-0.14%
Washington – Self Storage$0.00.0%0.00%
 Grand Total – Top 50 MSAs$32,842.54.9%0.02%
Source: CRED iQ

Specially Serviced Loans

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CRED iQ
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This week, CRED iQ calculated real-time valuations for 5 distressed properties that have recently transferred to special servicing, including two regional malls and a CBD office building in Cleveland, OH. For those interested in the affordable housing sector for multifamily properties, we highlighted two assets making negative headlines in suburban Indianapolis for neglect and mismanagement. The CRED iQ valuations factor in a base-case (Most Likely), a downside (significant loss of tenants), and dark scenarios (100% vacant). For full access to the valuation reports as well as full CMBS loan reporting, including detailed financials, updated tenant information, and borrower contact information, sign up for a free trial here.

Dayton Mall

778,487 sf, Regional Mall, Dayton, OH 45459

This $76.9 million loan transferred to special servicing on June 30, 2021 with non-monetary default cited as the reason. However, the transfer to special servicing was likely prompted by the June 13, 2021 bankruptcy of the borrower sponsor, Washington Prime Group. Prior to the owner’s bankruptcy, the mall’s occupancy and NCF had been declining significantly. Washington Prime Group identified the Dayton Mall as a highly levered asset on March 31, 2021 and re-classified the mall as a non-core part of its portfolio, making it a candidate for a discounted payoff or deed-in-lieu of foreclosure agreement.

The mall features two vacant anchor pads, consisting of a 203,548-sf former Elder-Beerman and a 185,790-sf former Sears, as well as two operational anchors, consisting of a 268,943-sf Macy’s and a 178,686-sf JCPenney. Only the JCPenney anchor pad is collateral for the mortgage loan. NCF for 2020 totaled $4.5 million with a DSCR of 0.90, and we don’t expect performance to materially improve in 2021. Midland Loan Services, as special servicer, has not commented on a workout strategy as Washington Prime Group’s bankruptcy proceedings will need to be resolved first. For the full valuation report and loan-level details, click here.

Brunswick Square

292,685 sf, Regional Mall, East Brunswick, NJ 08816

This $67.3 million loan transferred to special servicing on June 29, 2021 due to imminent monetary default at the borrower’s request. This marks the second transfer to special servicing within the past year as the loan last returned to the master servicer in December 2020 without any modifications. The loan is secured by 292,685 sf of in-line space at the Brunswick Square Mall. The mall is anchored by Macy’s and JCPenney but both tenants own their parcels and improvements.

Brunswick Square shares the same borrower sponsor as the Dayton Mall, discussed above, and similarly has been identified as a highly levered asset and non-core property. Rialto, as special servicer, is evaluating workout options which may revisit modification proposals. The in-line space collateral was 88% occupied as of December 2020 and has steadily declined from 99% occupancy at origination in 2014. For the full valuation report and loan-level details, click here.

1100 Superior Avenue

576,766 sf, CBD Office, Cleveland, OH 44114

This $48.0 million loan transferred to special servicing on June 28, 2021, due to delinquency. The loan is secured by a 22-story office tower located in the CBD of Cleveland, OH. The office building was 87% occupied as of March 2021 but was further impacted by the recent departure of its third-largest tenant, law firm Littler Mendelson. Littler Mendelson vacated 44,667 sf of space, accounting for 8% of GLA, at lease expiration in April 2021 in favor of Key Tower, which overlooks Cleveland Public Square. CRED iQ’s estimated occupancy for the property is 79%. The loan has been paid through April 6, 2021 and is over 60 days delinquent. LNR, as special servicer, has not commented on a workout solution for the loan. For the full valuation report and loan-level details, click here.

Lakeside Pointe At Nora & Fox Club Apartments

924 units, Multifamily, Indianapolis, IN 46240

This $32.0 million loan transferred to special servicing on June 29, 2021 due to imminent non-monetary default. The loan is secured by two multifamily properties with affordable housing restrictions that are located in suburban Indianapolis. According to an article from Fox59 News out of Indianapolis, the transfer to special servicing may be related to a lawsuit filed by the Indiana Attorney General’s Office against the borrower, which has a non-profit 501(c)(3) classification. The borrower’s non-profit status allows it to maintain an expemption from paying property taxes; although the exemption was recently revoked due to the issues outlined in the lawsuit.

The lawsuit alleges mismanagement and failure to maintain healthy living conditions for the properties’ residents. The Attorney General has requested a receiver be appointed to both properties. As recently as two weeks ago, the Lake Pointe at Nora property was damaged in a major fire that impacted the main leasing office and clubhouse and prior fires at the properties have resulted in downed units. Other items of concern included severe deferred maintenance, $1.2 million in outstanding water and sewer bills, mold, and broken fixtures throughout the premises. Aggregate NCF for both properties during 2020 was $1.2 million, which resulted in a DSCR of 0.61; however, property taxes were not included in those figures and could potentially total over $400,000. For the full valuation report and loan-level details, click here for Lakeside Pointe At Nora and here for Fox Club Apartments.

West Side Mall

420,434 sf, Power Center, Edwardsville, PA 18704

This $23.8 million loan transferred to special servicing on June 29, 2021 due to imminent monetary default at the borrower’s request. The loan is secured by a power center located in the Scranton–Wilkes-Barre MSA and the borrowing entity is encumbered by $2.0 million in mezzanine debt, which was held by Ladder Capital at origination. The property is anchored by a Lowe’s Home Improvement and a Price Chopper. Lowe’s owns its improvements and operates via a ground lease that expires in January 2027. Occupancy at the property was last reported to be 71% as of September 2020. Full-year financial statements were not reported for 2020 but the loan had a below breakeven DSCR in 2019 and 2018. Rialto, as special servicer, is in the process of initiating communication with the borrower. For the full valuation report and loan-level details, click here.

CRED iQ is a commercial real estate data, analytics, and valuation platform providing actionable intelligence to CRE and capital markets investors. Subscribers to CRED iQ use the platform to identify valuable leads for leasing, lending, refinancing, distressed debt, and acquisition opportunities. For full access to our loan database and valuation platform, sign up for a free trial below:

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