Aion Partners Hit By Foreclosure Complaint at Philly Office

New York-based Aion Partners appears to be out of time at a Center City office building in Philadelphia.

Special servicer Rialto Capital Advisors filed a foreclosure complaint against Aion on behalf of a CMBS trust, the Philadelphia Business Journal reported. The complaint alleged Aion owes $36.2 million on a $46.5 million loan backing One South Broad Street.

The loan matured in June, according to the complaint, after a two-year extension expired. Rialto is requesting a receiver to take control of the 25-story, 464,000-square-foot property.

Aion didn’t comment to the publication regarding the foreclosure complaint, but did consent to foreclosure and receivership, according to servicer notes in a CMBS report.

Aion put the property on the market back in the spring. At the time, servicer notes suggested there were ongoing discussions about resolving the loan ahead of the end of a forbearance period in June.

No buyer emerged in the intervening months. Newmark has been marketing the property, which materials suggest could be a candidate for a residential conversion.

Aion purchased the building in 2014 for $68 million. The property was 88 percent occupied at the time, but has seen steady declines. Wells Fargo abandoned 154,000 square feet — a third of the property — in 2020. Later in the year, Electronic Ink left 31,000 square feet, removing two of the three largest tenants from the property.

Occupancy hit 55 percent in September 2024, according to CMBS reports.

Leasing recovered slightly in the last year. T-Mobile, District 1199C Training Fund and real estate consulting firm Hammes signed small leases this year, according to CoStar. Occupancy is up to 61 percent, the highest level since Wells Fargo’s departure. Huntsworth Health is the largest tenant left at 43,500 square feet.

The city’s assessment of the property for the 2025 tax year was $76.6 million.

— Holden Walter-Warner