601W Seeking Three-Year Loan Extension for Aon Center

601W Companies is asking for more time to pay off its $536 million senior loan backed by the 200 East Randolph Street skyscraper known as the Aon Center.

The New York-based real estate firm requested a three year extension for the loan on the 83-story tower, according to Crain’s, who cited Bloomberg loan data. 601W reportedly told its lender it doesn’t have the ability to pay off the mortgage by its July 1 maturation date. 601W previously received a three-year extension for its loan on the building, according to the outlet.

In March of this year, 601W allegedly missed a required payment for tenant improvements, returning the 2.8 million-square-foot building to special servicing. It was the second time in three years that the skyscraper had faced the designation. Major leases, including the tower’s namesake, are set to expire towards the turn of the decade.

Occupancy rates at 200 East Randolph Street, dropped from 88 percent to 66 percent in March. A 2023 reappraisal slashed the building’s value to $414 million from $780 million, nearly cutting it in two.

The news came in the middle of a tough week in a rough year for 601W. Washington Capital, which is based out of Seattle, filed a $42.6 million foreclosure lawsuit against 601W’s 717 South Desplaines Street building leased by Tesla Thursday. The affiliated lender entities MIF IL Desplaines LLC and REEF IL Desplaines LLC, alleged that the borrowers defaulted on a $42 million commercial loan on May 1.

A 601W building in the Steel City is also showing signs of distress. In March, a loan backing the U.S. Steel Tower in Pittsburgh was transferred to special servicing ahead of a maturation date in June. 601W has owned the building since 2011, and while there’s steady cash flow, several major lease expirations are imminent at the property.

— Hunter Cooke