‘Tis the season of delinquency, and not a merry one for Los Angeles office landlord David Lee’s Jamison Properties.
A $35.4 million commercial mortgage-backed securities loan tied to Jamison’s 811 Wilshire Boulevard went to special servicing on Nov. 5 due to imminent default, according to Morningstar Credit. The loan was set to mature the following day.
Spokespeople for Jamison and master servicer KeyBank Real Estate Capital declined to comment, while special servicer LNR Partners, the CMBS servicing arm of Starwood Property Trust, did not respond to a request for comment.
Jamison acquired the 340,000-square-foot Financial District property in the early 2000s, and in 2014 landed a $39 million loan with a 10-year term from German American Capital. It was only 70 percent occupied at the time.
What happened the following year did not help attract tenants.
An explosion in the basement of 811 Wilshire rocked Downtown Los Angeles in August 2015, injuring four people and cutting off power in the area, including at the Staples Center where a Shania Twain concert was in full swing.
Jamison’s property insurance kicked in to cover the damage from the blast, which was traced to an underground power station controlled by the city, according to a report by Berkadia. Tenants were allowed to return to the building the following month, and Jamison refunded their rent in the interim.
The building emptied out further as the loan neared the end of its term. It’s now 47 percent occupied, according to Morningstar.
The U.S. Social Security Administration leases 37,272 square feet at the property, making it the largest tenant.
“Nobody is lending on a 47 percent-occupied L.A. office building at this point,” said David Putro, a senior vice president at Morningstar Credit. “It’s a very fluid market at the moment, so I can’t guess which direction this is going.”
And it’s not the only Jamison office property whose fate is in the balance.
The firm defaulted on a $86.5 million loan tied to Equitable Plaza in Koreatown last month, as The Real Deal previously reported. And a $17.4 million loan backed by Jamison’s 16530 Ventura Boulevard in Encino also went to special servicing in January, according to Morningstar.