Coretrust Capital Partners, having defaulted on a $271 million loan tied to its 640,000-square-foot office campus in Pasadena, will now see it go to auction.
The office investment firm based in Downtown L.A. defaulted on the loan in July after it failed to obtain financing for the four-building property at 251 South Lake Avenue, Bisnow reported.
The Dec. 20 foreclosure auction was initiated by Heitman, the lender based in Chicago.
John Sischo, managing principal for Coretrust Capital, said the firm tried to refinance the property for two years — to no avail.
“The capital markets are not in existence to take out a refinance for an office building, no matter how great the property is,” Sischo told Bisnow. “It’s not there.”
He declined to comment further.
The two- to 14-story complex, built between 1964 and 1982, surrounds a 60,000-square-foot plaza. The sale of the property, which includes 600,000 square feet of offices and 40,000 square feet of shops and restaurants, will go to pay debts secured by its deed of trust.
Coretrust Capital bought the block-size campus then known as Corporate Center Pasadena from Zurich-based UBS Realty in 2018 for $260 million, or $406 per square foot. It then poured in $50 million more for renovations.
Office tenants now include Industrious, NAI Capital Commercial and UBS. Retail tenants include Citibank and Dunkin’ Donuts.
More than 20 percent of all Los Angeles office loans, or 59.3 million square feet, are slated to mature between 2023 and 2025, according to Bisnow.
When the debt comes due, such properties are likely to be worth much less than when they were last last refinanced, setting some landlords up for similar defaults.
Coretrust Capital Partners owns the 48-story tower known as FourFortyFour South Flower. They bought the 915,000-square-foot building, once known as Citigroup Center, from Houston-based Hines in 2016 for $336 million. The company also owns office buildings in Philadelphia and Virginia.
— Dana Bartholomew
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