The Vanbarton Group has entered a deal to sell an 86,000-square-foot office building just steps away from Hollywood’s landmark TCL Chinese Theatre, The Real Deal has learned.
The New York-based firm is under contract to sell the building to a religious organization, according to a source familiar with the matter. The Vanbarton Group declined to comment.
The move comes as the property has struggled to produce cash over the last few years, mostly because of sluggish leasing, according to Morningstar data. This month, data firm Trepp reported The Vanbarton Group’s $21.7 million loan tied to the property was 30 days delinquent and has been sent to special servicing, a move that is necessary while the sale moves ahead, the source added.
The Vanbarton Group intends to pay off the loan, the source said. The loan was originated by JPMorgan Chase Bank and then packaged into a commercial mortgage-backed securities deal.
The property is under contract to sell for more than $21.7 million, which would allow the firm to pay off the debt. The exact sale price was not disclosed.
Vanbarton bought the building from CIM Group for $42 million in 2017, when it was anchored by WeWork, and assumed the CMBS loan as part of the deal, records show.
The property has struggled to produce cash over the last few years, mostly because of sluggish leasing, according to Morningstar data.
Live Nation exited 28,000 square feet in 2020 and WeWork, which occupied almost half of the building, left the following year. Vanbarton was able to fill some of the hole — Industrious, another coworking firm, leased 28,900 square feet at the property in 2022.
The property is now entirely vacant, according to the source.
In both 2022 and 2023, the income from the property has not been enough to meet debt service obligations on the loan, according to Morningstar. When JPMorgan originated the loan in 2016, the property was reeling in double what was needed to service the debt.
The post Vanbarton Group strikes deal to sell empty Hollywood Boulevard offices appeared first on The Real Deal.
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