Jamison Properties’ loan on an office complex in Encino has been sent to special servicing, after the landlord disclosed it would need more time to figure out a way to refinance it, The Real Deal has learned.
The $21.5 million loan on 16530 Ventura Boulevard is in special servicing, according to Morningstar, which cited servicer commentary. Loans are most often sent to special servicing when a property is looking at an imminent default or the borrower is delinquent on payments for at least 60 days.
Deutsche Bank had provided the 10-year loan in 2014, which it then packaged into a commercial mortgage-backed securities deal, Morningstar data shows. The loan has a fixed interest rate of 5.5 percent.
Jamison has owned the 157,400-square-foot building since 2002, records show. The firm declined to comment.
The loan was set to mature in January, though Jamison had indicated to the master servicer on the loan, Wells Fargo, that it needed “additional time to get the loan refinanced,” according to Morningstar.
As of November, the loan’s debt service coverage ratio was -0.15. Any DSCR of less than 1 shows negative cash flow, meaning the borrower is unable to make debt payments using income from the property.
The property is struggling to keep tenants. Occupancy has dropped to 39 percent as of November, from about 42 percent in the first quarter of the year.
Jamison is working on a renovation plan at the property, looking to add at least two spec suites — move-in ready office spaces that do not require significant tenant improvements — and common area upgrades.
“Operating expenses have stayed relatively consistent since [the loan was issued], but income has taken a significant dip,” Wells Fargo said in November commentary.