Designer Max Azria has defaulted on $34.6 million in loans attached to a trio of Vernon warehouses.
The portfolio loan, which was originated by LaSalle Bank in 2007, has been sent to special servicing due to a maturity default, according to data provided by CMBS analytics firm Trepp.
The 601,979-square-foot portfolio comprises three buildings at 2701-2761 Fruitland Avenue, 2665 Leonis Boulevard and 4701 S. Santa Fe Avenue. The properties have been 100 percent occupied by the high-end women’s fashion retailer since securitization in 2007, Trepp said.
The default likely comes as little surprise to those in the fashion know. Azria’s glitzy fashion label BCBG filed for bankruptcy earlier this month and said it will close 120 of its stores.
Its top executives cite a shift in consumer habits, including a migration towards online shopping and less emphasis on branded apparel.
Per the bankruptcy filing, the company will sell in a court-supervised auction in May. If it receives no acceptable bids, it will attempt to negotiate a debt-for-equity swap with lenders.
Vernon-based BCBG reportedly owes its lenders close to $500 million. It leases the warehouses from Azria.
At its height, BCBG operated more than 570 stores internationally.
Correction: In a previous version of this story, The Real Deal incorrectly identified BCBG as the debtor. The debt is personally held by Max Azria, according to a BCBG spokesperson.