Lending woes at Playa

A mortgage note on the complex's largest office development site has been put up for sale, the Business Journal is reporting. The development is entitled for nearly 2 million square feet of office and commercial space, and was expected to be built out over several years.

According to sources with knowledge of the situation, the mortgage has a balance of more than $150 million and is held by a consortium of lenders led by KeyBank of Cleveland. The note is expected to fetch roughly $50 million; a sale for that amount could represent a write-down of at least two-thirds. A payment of about $150 million was due on the mortgage this summer, but New York-based Tishman Speyer and Chicago-based Walton opted to not pay it. They bought the property in February 2007, near the height of the market, and commercial real estate values have since crashed. Rather than foreclose and take over the property, the lenders decided to sell the note, according to a source.

More by Mark Lacter:
American-US Air settlement with DOJ includes small tweak at LAX
Socal housing market going nowhere fast
Amazon keeps pushing for faster L.A. delivery
Another rugged quarter for Tribune Co. papers
How does Stanford compete with the big boys?
Those awful infographics that promise to explain and only distort
Best to low-ball today's employment report
Further fallout from airport shootings
Crazy opening for Twitter*
Should Twitter be valued at $18 billion?
Recent stories:
Letter from Down Under: Welcome to the Homogenocene
One last Florida photo
Signs of Saturday: No refund
'I Am Woman,' hear them roar
Bobcat crossing

New at LA Observed
On the Media Page
Go to Media

On the Politics Page
Go to Politics
Arts and culture

Sign up for daily email from LA Observed

Enter your email address:

Delivered by FeedBurner


Advertisement
Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
 
Mark Lacter, business writer and editor was 59
The multi-talented Mark Lacter
LA Observed on Twitter and Facebook