Another deal for EY Plaza fell apart, leaving the downtown office tower on the market and looking for a third taker.
“The approved buyer declined to proceed with the transaction, and a new buyer is being identified,” according to servicer commentary via Morningstar Credit dated early April.
The undisclosed buyer was selected out of a pool offering more than $100 million, The Real Deal recently reported, noting a deal could collapse. Approvals were obtained then, and the would-be buyer was provided with a loan sale agreement and a joint escrow instruction letter. The draft agreement called for a 45-day due diligence period and 45-day close.
It is unclear what happened — but it’s the second time a buyer has backed out of an EY Plaza deal.
Carolwood, a private equity outfit helmed by Adam Rubin and Andrew Shanfeld, had a $130 million deal to purchase the distressed downtown Los Angeles office tower, but it fell through last year. A person familiar with the Carolwood deal told TRD the breakdown had to do with a lease renewal involving the United States Secret Service, and millions of dollars were at stake. Servicer commentary said it was “unable to negotiate acceptable documentation with the selected buyer,” at the time.
The skyscraper located in the Financial District and owned by Brookfield is in a receiver’s hands, and has been for three years after the commercial giant missed payments and later defaulted on hundreds of millions of dollars of debt.
After the Carolwood deal collapsed, Colliers replaced Eastdil Secured and marketed the non-preforming $275 million loan on the 41-story, around 900,000-square-foot tower at 725 South Figueroa Street — one of multiple Brookfield-related offerings downtown. The note is expected to trade at a “massive discount,” a Colliers offering stated.
The tower is valued at $135 million, according to Morningstar, which is a long ways away from the $446 million it was worth six years ago.
Receiver Gregg Williams of Trident Pacific Real Estate and special servicer Situs Holdings did not immediately respond to a request for comment. Colliers declined.
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