Trophy Arlington Office Tower Heading To Foreclosure Auction
While it eventually landed a major corporate headquarters tenant, the developer was unable to stabilize the building and now risks losing it on the auction block.
A Monday Properties spokesperson said in an emailed statement to Bisnow it will continue to provide management and leasing services for the building and will ensure that tenants aren't affected.
"The capitalization of 1812 North Moore Street is being restructured through a procedural process, which was initiated recently," the statement says. "The current market volatility demands we are resilient to get through industry challenges ahead and lay the foundation for long-term success."
Monday Properties speculatively built the 538K SF office tower in 2013, the tallest building in the region at the time, and it sat vacant for more than three years. It landed an anchor tenant in February 2017 when Nestlé leased 206K SF on the upper floors, relocating its U.S. headquarters from California.
The Nestlé lease was hailed by local and state officials, including then-Gov. Terry McAuliffe, as a big win that would spur momentum for the building and the larger market. It won the local CREBA award for the top Virginia lease deal of 2017.
But 1812 North Moore still has more than 100K SF available for lease, according to Monday's website. Eastdil's foreclosure notice says it is 76% leased with an average weighted lease term of 8.1 years.
The foreclosure notice comes after Monday Properties in June defaulted on loans backed by a separate portfolio of seven office buildings totaling 2.1M SF in Rosslyn, as Bisnow first reported. The landlord missed payments on a $691M senior CMBS loan and a $150M mezzanine loan ahead of a June 9 maturity date, and the loans were transferred to special servicing.
Monday isn't the only office landlord in the D.C. region facing distress, as the remote work shift has spurred record-high vacancies, and capital providers have pulled back from lending to the troubled sector.
Earlier this month, Republic Properties Corp.'s lender initiated foreclosure proceedings on its 660 North Capitol St. office building. In October, Blackstone handed its stake in D.C.'s Metropolitan Square to lender Artemis Real Estate Partners through a deed-in-lieu-of-foreclosure sale. In June, a JPMorgan Chase-affiliated lender moved to foreclose on Manulife's 1850 M St. NW.