The distressed, Brookfield-owned EY Plaza is back on the market after Carolwood’s $130 million deal to purchase the downtown office tower fell apart. The Real Deal previously reported the sale collapsed.
It appears Colliers replaced Eastdil Secured in marketing the $275 million note tied to the property at 725 South Figueroa Street, according to an offering memorandum. The note is expected to trade at a “massive discount,” the offering stated, adding that the loan is currently classified as non-performing.
The 41-story, 900,000-square-foot office tower, placed in receivership after debt default, was valued at $150 million after an appraisal last year, compared to $446 million four years earlier when the debt was issued, per Morningstar data. A subsequent deal collapsed in recent months when Adam Rubin and Andrew Shanfeld’s Carolwood fell out of contract. Servicer commentary indicated that it was “unable to negotiate acceptable documentation with” Carolwood.
It remains to be seen whether Carolwood missed out on a bargain or dodged a bullet when its $130 million deal went to the wayside.
“This sale offers investors the opportunity to acquire this non-performing loan at a massive discount to note balance, historic trades in DTLA going back decades, and estimated replacement cost of over $750 per square foot,” the memo reads. It notes the offices are 61 percent leased to 27 tenants.
That includes the office tower’s anchor tenant for which it is named after, Ernst & Young, who has occupied the property since 1999. The company’s lease spans 128,000 square feet, about 14 percent of the total space, per Morningstar.
Correction: an earlier version of the article misstated an asking price.
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