A Houston-based real estate investment trust is selling assets in order to pay down $217M in debt.
Silver Star Properties REIT sold three of the 30 properties backing a commercial mortgage-backed securities loan for a combined $41M, CoStar reported. The loan — scheduled to mature Oct. 9 — was transferred to a special servicer after the company filed for Chapter 11 bankruptcy earlier this fall.
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The largest property sold was the 117K SF Garden Oaks Shopping Center in Houston for $27.2M, CoStar reported, citing court filings.
The REIT is also looking to sell nine additional properties that are under contract for purchase, per bankruptcy court filings. Those sales would shave another $80M off the CMBS debt.
The special servicer with KeyBank Real Estate Capital told CoStar the company is hoping to pay down enough debt to secure refinancing for the loan. The CMBS deal is secured by 30-plus office, retail and industrial properties totaling 4.8M SF in the Dallas, Houston and San Antonio markets, CoStar reported.
Silver Star’s quest to balance its books comes just weeks after the resignation of former CEO Steven Treadwell, who had helmed the company for just two months prior to stepping down.
President David Wheeler was appointed interim CEO as the company looks for Treadwell’s replacement.
Treadwell was hired to lead Silver Star’s transition into the self-storage sector. The company began selling off its office, retail and industrial properties earlier this year.
As of June, the REIT owned 41 commercial properties comprising about 5.5M SF, plus one pad site and one land development, all of which were located in Texas, according to a Securities and Exchange Commission filing.
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