A 2.1M SF portfolio of Rosslyn office buildings changed hands in recent weeks after Monday Properties defaulted on its loans, and the new owner has now secured an extension to pay off the properties' huge, overdue debt bill.

Beacon Capital Partners reached an agreement with the holders of the $691M CMBS loan to grant a three-year extension with two additional one-year extension options, according to Morningstar Credit. In exchange, Morningstar says Beacon made a "substantial equity contribution."

The loan's interest rate was also modified with the extension, according to Morningstar. The original loan had a floating rate, but it is now set at 6%, with half of that to be paid regularly and the other half accruing.

A Beacon Capital spokesperson declined to comment on the loan extension.

The seven properties were previously owned by Monday Properties, a longtime dominant property owner in the area. Monday went into default on its loans — the $691M senior loan and a $150M mezzanine loan — when it missed payments ahead of a June 2023 maturity.

The debt was then transferred to special servicing, but Monday kept working to stabilize the properties. It landed a 40K SF headquarters lease at the 31-story 1100 Wilson Blvd. tower in January 2024, and President Tim Helmig told Bisnow at the time that the deal "underscores our ability to shepherd the assets through these challenging times."

But earlier this month, the Washington Business Journal reported that Monday Properties and its equity partner, Goldman Sachs, lost the portfolio in December and that Beacon Capital Partners is the new owner.

Morningstar Credit Head of CRE Analytics David Putro told Bisnow that the mezzanine loan was sold last year, which could have been used to take control of the properties via an ownership entity foreclosure rather than a deed transfer.

"I assume the mezz is gone at this point," Putro wrote in an email. "So if Beacon bought the mezz loan that was in default, they effectively became the borrower on the senior loan and took control of the properties by foreclosing on the mezz loan."

Monday told the WBJ that the loss "reflects the broader challenges currently facing the real estate sector due to the difficult conditions in the capital markets" and "does not impact the rest of our diverse portfolio of office and multifamily properties."

In addition to 1100 Wilson Blvd., the office buildings in the portfolio are 1000, 1101, 1200, 1501 and 1515 Wilson, along with 1701 Fort Myer Drive.

The portfolio was last appraised in January 2024 at $682.7M, according to Morningstar, down from $1.1B when the debt was issued and well below the value of the mortgage.