A roughly $32 million loan on the Metropolitan building downtown was sent to special servicing after the borrower defaulted on their commercial mortgage-backed securities debt, according to Morningstar Credit.
Servicer commentary via Morningstar reported a notice of default was sent, and the lender is lawyering up while in talks with the borrower, the Fallas family.
Michael Fallas, who was CEO of National Stores — a discount retailer founded by his father, and the bankrupt parent company of Fallas Paredes — is the named loan sponsor. Fallas did not immediately respond to a request for comment; the special servicer declined.
The mid-rise, mixed-use property on Fifth and South Broadway in downtown Los Angeles’ Historic Core is on the market, according to a Zacuto Group and Northmarq unpriced offering memorandum.
The Beaux-Arts style building designed by John Parkinson at 449 South Broadway includes 88 apartments and a rooftop pool, as well as ground-floor retail, which was formerly a Fallas Paredes store but is now completely vacant. The apartments, on the other hand, are 91 percent occupied, per the marketing materials. Built in the early 1900s, the around 160,000-square-foot building is a designated Los Angeles Historic-Cultural Monument.
Downtown Los Angeles’ distress doesn’t only mean office, though that is where we are seeing most of the pain. Either way, distress can mean exits and sell-offs. The Brookfield-owned FIGat7th is on the market, The Real Deal previously reported.
The loan on the mall in downtown Los Angeles’ Financial District at 735 South Figueroa Street is set to mature in the coming months after the commercial giant landed an extension on the $58.5 million note. The shopping center could call for $70 million, or about $210 per square foot, which is much lower on a per-square-footage basis than the pricier retail trades last year. This is just one of multiple offerings in the area tied to Brookfield.
But it isn’t all bad news. Earlier this year, there was APW Avenue Group’s downtown apartment tower purchase for about $69 million. The deal for the 22-story property that has 152 apartments atop retail space at 717 West Olympic Boulevard in trendy South Park came out to around $450,000 per apartment, which was in line with some of the pricier multifamily trades on a per-apartment-basis on last year’s ranking.
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Commercial
Los Angeles
Brookfield’s latest selloff: FIGat7th
Commercial
Los Angeles
MetLife sells apartment tower downtown for $69M