(Source: J. Scott Trubey The Atlanta Journal-Constitution) – Bank of America Plaza is being advertised for a foreclosure sale next month, an expected step foreshadowed by recent reports of distress for Atlanta’s tallest skyscraper.
The 55-story tower at Peachtree Street and North Avenue is scheduled to be auctioned from the Fulton County Courthouse steps Feb. 7, according to an advertisement in Wednesday’s edition of the Fulton County Daily Report.
A deal could still be reached to avoid foreclosure, but the notice was not unexpected. The debt on the tower has been distressed for some time, and a special servicer — a firm that helps work out troubled loans — was bought in nearly a year ago.
The original debt, with an initial combined balance of $363 million, is in default, according to the notice.
LNR Partners, the special servicer, recently started preparing for a possible foreclosure amid ongoing negotiations with the building’s owner, California-based BentleyForbes, according to a report by real estate research firm Trepp.
BentleyForbes bought the 55-story tower at the height of the real estate boom, paying an Atlanta-record $436 million.
A BentleyForbes executive said last week his firm was in “active dialogue” with the servicer, and was committed to working toward “a way forward” for the tower. A representative for BentleyForbes said Wednesday the firm stands by that statement
Major tenants include its namesake, Bank of America, and law firm Troutman Sanders. But occupancy in the building has dipped to 79 percent, according to Trepp.
A possible foreclosure of Bank of America Plaza comes as delinquency rates for commercial mortgage backed securities, or CMBS, a type of loan for commercial properties, reached an all-time high in metro Atlanta last month, according to Trepp.
Many in commercial real estate circles have viewed 2012 with some dread for the pending maturities of scores of commercial mortgages made during the peak of the market.
Refinancing such debt is difficult given declining property values, the tumultuous leasing market and other economic factors.
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Source: J. Scott Trubey The Atlanta Journal-Constitution