Pasarroyo reverts to lender after auction flops

Pasarroyo, a four-building office complex spanning a city block in Pasadena, found no bidders beyond an opening offer at a public auction Dec. 20, so it went back to the control of its lender Heitman, based in Chicago.

The opening bid for Pasarroyo, owned by Coretrust Capital Partners, was $114 million. It’s about 42 percent of the $271 million that Heitman is owed on the building. It is 45 percent of what Coretrust paid for it in 2018, according to Bisnow, which first reported the auction result. It is unclear what Heitman hopes to do with the property.

It is common for multimillion-dollar properties not to receive bids at an auction, according to foreclosure professionals consulted by Bisnow. But often interested buyers will contact a lender away from auction proceedings and negotiate privately. 

Pasadena’s office availability was 29.8 percent in the third quarter, compared to Los Angeles’ overall availability of 26.5 percent, according to a report from Savills.

Pasarroyo stretches to more than 640,000 square feet, and is the largest office complex in Pasadena. Tenants include KW Commercial, Pennymac Loan Services and UBS, according to a LoopNet listing. 

CoreTrust acquired the building in 2018 and embarked on a capital improvement plan of the office campus’ plaza as well as its main buildings, according to a description of the property. The compound’s buildings were constructed between 1964 and 1982. The buildings range in height from two to 14 stories. The complex offers 2,000 onsite parking space in a seven-story garage. 

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