A $370M office loan in the Loop moved to special servicing this month after the borrower indicated it might not be able to make its payments.
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Beacon Capital Partners' massive CMBS loan on AMA Plaza at 330 N. Wabash Ave. was transferred to special servicer Situs Holdings, which warned of “imminent monetary default,” according to Morningstar Credit. Beacon told its servicer that it may not be able to make its August 2024 loan payment or the $4.4M tax payment due on Aug. 1, according to servicer commentary.
Beacon scooped up AMA Plaza for $470M in 2016 and refinanced it with the $370M floating-rate loan in 2021. The loan moving to special servicing came despite Beacon securing a one-year maturity date extension a few weeks ago, pushing the due date from June 2024 to June 2025, The Real Deal reports.
“330 North Wabash is an extraordinary property, and we are currently engaged in active and productive discussions with the special servicer,” a spokesperson for the company told TRD.
The property's occupancy dropped slightly to 84% as of the end of last year, down from 94% when the loan was issued, but appeared to have minimal short-term rollover risk from its larger tenants, Morningstar Credit notes said. However, two large tenants had termination or contraction options effective earlier this year, and it is unclear whether they were executed.
The building's titular tenant, the American Medical Association, occupies the largest block and has a termination option in 2025, with notice required by February 2024. The company leases 261K SF in the building, or roughly 22% of the leasable space. It is unknown whether the company chose to execute its termination option, per Morningstar Credit.
The second-largest tenant, Latham & Watkins, had a contraction option come up earlier this year. It is also unclear if that was exercised. The law firm leases 143K SF in the building, or about 12% of the leasable space.
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