3,000-unit SF complex seeks forbearance on nearly $1B loan

Maximus Real Estate cited hardships related to pandemic as reason for request on sprawling Parkmerced rental

TRD NATIONAL /
Apr.April 22, 2020 06:30 PM
Parkmerced

The Parkmerced apartment complex in San Francisco.

UPDATED, 1:40 p.m. April 23:Maximus Real Estate Partners has requested debt forbearance on a $955 million loan for its massive Parkmerced residential development in San Francisco, the latest casualty of the coronavirus crisis.

KeyBank is the master servicer of the loan, and Maximus is making the request  because of hardships related to the pandemic, according to Kroll.

The debt is secured by Maximus’ fee simple interest in 3,165 of the 3,221 units in the apartment complex. The units are spread across 11 apartment buildings, 154 townhouses and 10 common area buildings.

The complex is the largest multifamily property in San Francisco and the second largest multifamily property west of the Mississippi River, according to Kroll.

The development firm has asked for a forbearance of debt payments starting with the one due in May “and continuing until public policy permits normalization of commerce.” It is also asking for flexibility to provide its tenants with short-term rent relief and for the suspension of restrictions on cash management.

San Francisco has issued a moratorium on evictions for any reasons except violence, health and safety issues until June 21. Maximus expects that will impact its rent collection, according to Kroll. It has assigned the Parkmerced loan an outlook of “underperform.”

Maximus paid its debt service in full for April and has no immediate plans to seek forbearance, according to Parkmerced spokesman PJ Johnston.

“Like virtually every other capitalized business in the United States, we have been forced to discuss a wide array of pending issues with our lenders, given the coronavirus pandemic and its impacts on our business,” he said in a statement.

Representatives for KeyBank did not immediately respond to a request for comment.

The San Francisco Bay Area has an extremely tight housing market, but the pandemic has put a dent in it, with sales dropping by 35 percent year over year.

Last week, Freddie Mac said it was extending the forbearance period for multifamily borrowers and beefing up the eviction ban requirement for landlords who receive the relief.

This story has been updated to include a response from Parkmerced.


Related Articles

arrow_forward_ios
Bozeman, Montana

Montana’s real estate market shows no signs of cooling heading into winter

Montana’s real estate market shows no signs of cooling heading into winter
An aerial view of a pop-up drive-in theater built in the parking lot at the Broadway Commons in Hicksville, New York (Getty)

Covid pummeled shopping centers, but their parking lots are thriving

Covid pummeled shopping centers, but their parking lots are thriving
The number of mortgage borrowers in Covid-19 forbearance plans ticked down again this week. (iStock)

3M homeowners remain in forbearance

3M homeowners remain in forbearance
Mayor Bill de Blasio and the Lucerne Hotel at  201 West 79th Street (Getty; iStock; Google Maps)

Lawsuit blasts NYC’s “capricious” Covid-19 homeless response

Lawsuit blasts NYC’s “capricious” Covid-19 homeless response
Gap CEO Sonia Syngal (Getty)

Gap Inc. will close 350 stores and exit malls entirely

Gap Inc. will close 350 stores and exit malls entirely
(iStock)

Dead weight: A breakdown of NYC’s rental listing glut

Dead weight: A breakdown of NYC’s rental listing glut
The National Multifamily Housing Council’s monthly payment tracker found that 90.6 percent of those households paid some rent by Oct. 20. (iStock)

Rent collections in market-rate apartments stagnate in October

Rent collections in market-rate apartments stagnate in October
Gov. Andrew Cuomo (Getty; iStock)

New York City lifts lockdown for some Covid hot spots

New York City lifts lockdown for some Covid hot spots
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...