The 990 S. Broadway building was built in 1984. (Thomas Gounley/BusinessDen)
The local owner of an office complex at Broadway and Interstate 25 in Denver is expected to default on its loan upon maturity next month.
Offices at Broadway Station consists of two four-story buildings at 900 and 990 S. Broadway in Denver, as well as a parking garage with some office space across the street at 100 E. Tennessee Ave.
The 318,000-square-foot complex is owned by Denver-based Sagard Real Estate, which bought it in July 2014 for $73.25 million, according to public records. Sagard, at the time known as EverWest Real Estate Investors, financed the deal with a $47.6 million loan from Wells Fargo Bank.
That loan will mature on Aug. 11, according to a report from Trepp, a firm that tracks commercial real estate loans. Maturity refers to the point when a loan must be paid off.
According to the Trepp report, the loan was transferred to special servicing in April because of “imminent maturity default” — meaning the lender doesn’t expect Sagard to pay off the debt by next month. The owner had been making its monthly payments through April, per the Trepp report, which doesn’t cover the months since.
Sagard didn’t respond to requests for comment this week.
Special servicers are essentially negotiators brought in when a lender gets concerned about an asset, either because the owner has defaulted or because of some other factor, such as the loss of a major tenant. Speaking to BusinessDen last year, a Trepp executive likened special servicing to a sort of “purgatory,” which could lead to foreclosure but also potentially to an alternative resolution.
The building at 900 S. Broadway was originally an assembly plant for Ford Motor Co. (Thomas Gounley/BusinessDen)
Offices at Broadway Station was 82 percent occupied as of last fall, according to Trepp. That figure was 100 percent at the end of 2021, then declined to 63 percent by the end of 2022 before recovering somewhat since.
Tenants include orthodontics software company OrthoFi, engineering and architectural firms Wilson & Co. and Ware Malcomb and T-Mobile, per signage at the property.
Office landlords generally refinance or sell when a loan is approaching maturity. But doing either of those things has become extremely difficult in recent years given high interest rates, reduced demand for office space from tenants and lender concern over their exposure to commercial real estate.
The 900 S. Broadway building was built in 1903 as an assembly plant for Ford Motor Co., according to the complex’s website. More than 200,000 vehicles were assembled there before the property was sold to Gates Corp. in the 1940s.
The 990 S. Broadway building was added in 1984, and the four-story parking structure was built in 2008, according to the complex’s website.
Read more: Troubled towers: Breaking down Denver’s distressed office properties
Correction: A previous version of this story incorrectly stated that the lender had been making its required payments through April. It has been corrected to state that the owner has been making its required payments.
The 990 S. Broadway building was built in 1984. (Thomas Gounley/BusinessDen)
The local owner of an office complex at Broadway and Interstate 25 in Denver is expected to default on its loan upon maturity next month.
Offices at Broadway Station consists of two four-story buildings at 900 and 990 S. Broadway in Denver, as well as a parking garage with some office space across the street at 100 E. Tennessee Ave.
The 318,000-square-foot complex is owned by Denver-based Sagard Real Estate, which bought it in July 2014 for $73.25 million, according to public records. Sagard, at the time known as EverWest Real Estate Investors, financed the deal with a $47.6 million loan from Wells Fargo Bank.
That loan will mature on Aug. 11, according to a report from Trepp, a firm that tracks commercial real estate loans. Maturity refers to the point when a loan must be paid off.
According to the Trepp report, the loan was transferred to special servicing in April because of “imminent maturity default” — meaning the lender doesn’t expect Sagard to pay off the debt by next month. The owner had been making its monthly payments through April, per the Trepp report, which doesn’t cover the months since.
Sagard didn’t respond to requests for comment this week.
Special servicers are essentially negotiators brought in when a lender gets concerned about an asset, either because the owner has defaulted or because of some other factor, such as the loss of a major tenant. Speaking to BusinessDen last year, a Trepp executive likened special servicing to a sort of “purgatory,” which could lead to foreclosure but also potentially to an alternative resolution.
The building at 900 S. Broadway was originally an assembly plant for Ford Motor Co. (Thomas Gounley/BusinessDen)
Offices at Broadway Station was 82 percent occupied as of last fall, according to Trepp. That figure was 100 percent at the end of 2021, then declined to 63 percent by the end of 2022 before recovering somewhat since.
Tenants include orthodontics software company OrthoFi, engineering and architectural firms Wilson & Co. and Ware Malcomb and T-Mobile, per signage at the property.
Office landlords generally refinance or sell when a loan is approaching maturity. But doing either of those things has become extremely difficult in recent years given high interest rates, reduced demand for office space from tenants and lender concern over their exposure to commercial real estate.
The 900 S. Broadway building was built in 1903 as an assembly plant for Ford Motor Co., according to the complex’s website. More than 200,000 vehicles were assembled there before the property was sold to Gates Corp. in the 1940s.
The 990 S. Broadway building was added in 1984, and the four-story parking structure was built in 2008, according to the complex’s website.
Read more: Troubled towers: Breaking down Denver’s distressed office properties
Correction: A previous version of this story incorrectly stated that the lender had been making its required payments through April. It has been corrected to state that the owner has been making its required payments.
