Blackstone apparently will count on a cornerstone tenant to see it through the resetting of the office market in San Francisco, and a fresh loan extension to back its play.
The New York-based investor settled on new terms for a $195 million loan against the Schwab building at 211 Main Street in the Financial District, Bisnow reported.
The deal shifts the loan on the 417,000-square-foot, 17-story building from special servicing back to Overland Park, Kansas-based Midland Loan Services. The loan portfolio on the property also includes three subordinate notes that combine for $25 million in obligations, according to Morningstar.
Blackstone now has a maturity date of April 2028 on the financing package, which it allowed to fall into default earlier this year.
Charles Schwab leases the entire building, although the financial services provider has trimmed the amount of space it uses to about 170,000 square feet — roughly a third of the available space.
Schwab plans to move its headquarters to Dallas but has indicated it will keep a significant workforce in the Bay Area. In any case, the tenant is responsible for the entire building on Main Street through 2028, and it is making space available for sublease.
The concurrent timelines of the Schwab lease and Blackstone’s new loan explain why the landlord has expressed confidence throughout the default and special servicing on the property.
“This is a procedural step needed to effectuate a change to the term of the loan, which requires approval from the special servicer,” a Blackstone spokesperson said in April. “This building is 100 percent leased to a high-quality, credit-worthy tenant through 2028.”