Judge Approves Bankruptcy Auction For $100M Wynwood Office Project
The Gateway at Wynwood office building is heading back to the auction block.
A bankruptcy judge has ordered an auction on June 30 for the 14-story building at 2916 N. Miami Ave. as well as a neighboring Chase Bank branch after their owner defaulted on the mortgage tied to the buildings and filed for Chapter 11 protection last year, the South Florida Business Journal reported.
Long Island, New York-based R&B Realty developed Gateway at Wynwood in 2021 with 195K SF of office, 25K SF of retail and 490 parking spaces. It took out a $113M loan in 2023 from Idaho-based A10 Capital for the building and the 5,187 SF bank at 2830 N. Miami Ave.
A10 securitized a $92M senior loan into a commercial mortgage-backed security, according to loan documents. The debtors, R&B-managed entities named Gateway at Wynwood LLC and 2830 Wynwood Properties LLC, owe $112M plus principal, interest, fees and costs to the CMBS trust, according to filings in the U.S. Bankruptcy Court Eastern District of New York.
A10 is acting as special servicer for the CMBS loan, while Wilmington Trust is serving as the trustee, according to court filings.
The lender can make a credit bid on the property if external bids don't cover the outstanding amount on the loan. Initial bids are due by June 23 and must include a 5% deposit, with closing required within 15 days of court approval.
A10 and R&B Realty didn't respond to Bisnow’s request for comment.
The office remains significantly vacant with about 88K SF available, leaving it at only 55% leased, according to listings on LoopNet.
Wilmington Trust, as trustee, filed a $113M foreclosure suit on the buildings in Miami-Dade County Court in March last year. R&B’s properties were on their way to a foreclosure auction when its entities filed for Chapter 11 reorganization to buy time in July.
The bankrupt entities' chief restructuring officer, David Goldwasser, wrote in their Chapter 11 petition that the pandemic, rising interest rates and a cyberattack that resulted in a $3M theft all contributed to the buildings' distress. Goldwasser wrote that the developer was forced to take out a short-term loan to pay off the buildings' matured construction debt.
In the filing, Goldwasser said the 450K SF Gateway at Wynwood is worth roughly $100M or $110M if it were stabilized. When the CMBS loan was underwritten, an appraisal estimated Gateway's stabilized value at $193.2M.
No broker has been assigned, but the auction is being overseen by the debtors’ New York attorney, Kevin Nash of Goldberg Weprin Finkel Goldstein LLP.
He didn't respond to Bisnow’s request for comment.
