$1.2B Loan On Offices Owned By Vornado, Trump Added To Watchlist

Perspective view looking up 555 California Street building San Francisco
The Bank Of America Tower At 555 California St. In San Francisco.

An office complex owned by Vornado Realty Trust and The Trump Organization featuring the 52-story Bank of America Tower in San Francisco has reportedly landed on a lender watchlist less than two years after the owners secured new debt.

The owners received a $1.2B mortgage on the complex in May 2021. But as the cost of floating debt has risen and San Francisco's office market continues to spiral, that mortgage has sailed into uncertain territory, Bloomberg reported Tuesday.

In addition to the Bank of America Tower at 555 California St., the complex includes 315 and 345 Montgomery St.

Trump owns a 30% stake in the complex, which was reportedly a point of consternation for Vornado in the past. Following the Jan. 6, 2021, insurrection, major real estate and financial institutions, including Cushman & Wakefield, JLL and Deutsche Bank, dropped Trump as a client.

That led Vornado to consider buying out Trump at 555 California St. and 1290 Sixth Ave. in New York.

But by May, The Trump Organization announced it was able to secure the $1.2B mortgage at a 2% rate, Bloomberg reported. The joint owners also landed new debt at their New York skyscraper in November.

Vornado and Trump have the option to extend the loan on their San Francisco properties with up to five one-year renewals, according to Bloomberg. Vornado previously reported the office complex was 95% occupied with rent revenue more than double the cost of debt for the property.

This isn't the only property where former President Donald Trump is facing financial uncertainty. His marquee office tower at 40 Wall St. is facing declining revenues and rising costs, prompting debt servicer Wells Fargo & Co. to inquire about plans for improvement last week.

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