The latest interest rate cut provided hope for some commercial property owners on the brink of distress. But for others, it’s too late.
At the Oct. 1 foreclosure sale in Houston’s Harris County, at least seven properties with mortgages totalling $260 million are set to be auctioned, according to Roddy’s Foreclosure Listing Service.
The situation has been particularly dire for owners of older office space. Midway through this year, Houston’s office vacancy rate was 26.3 percent, according to a recent report from Partners Real Estate. That’s a jump from 24.7 percent a year before.
Here’s a list of the biggest commercial properties facing foreclosure in Harris County next month. It’s possible that some of these borrowers and lenders reach agreements to avoid foreclosure before Oct. 1.
Office
One Riverway
One Riverway is a 25-story office building in Houston, just west of the Buffalo Bayou. Owner Beverly Hills-based Unilev Capital defaulted on an $80 million mortgage that German American Capital Corporation originated in 2015, according to the foreclosure notice. The 500,000-square-foot building was built in 1978 and renovated in 2020.
2900 Weslayan
Lender Frost Bank claims Houston-based Griffin Partners defaulted on a $19.35 million loan it provided in 2020 for the purchase of 2900 Weslayan. The six-story building was built in 1979 and spans 137,000 square feet. The property is located just south of River Oaks in Houston.
2401 Fountain View Drive
In 2020, Finial Group borrowed $17 million ($95.50 per square foot) to purchase a 178,000-square-foot office building located at 2401 Fountain View Drive in west Houston. Lender Woodforest National Bank moved to foreclose on the property last month. The 10-story building was constructed in 1981 and renovated in 2017.
Multifamily
Reserve at 6363
Lakewood, New Jersey-based Omni and Brook Holdings defaulted on a $37.25 million ($79,594 per unit) mortgage used to purchase the 468-unit Reserve at 6363 in 2022. Capital One originated the loan. The property was constructed in 1983 and is located at 6363 Airport Boulevard in southwest Houston.
Park North
Park North is a 372-unit apartment complex in north Houston at 16112 North Freeway. The owners defaulted on a $56.3 million ($151,344 per unit) loan provided by Arbor Realty in 2022. The owners are a group of LLCs associated with Florida-based Inman Equities. The property was built in 2008.
Northbrooke Apartment Homes
Mudra Investments defaulted on a $32.5 million ($135,417 per unit) loan from Arbor Realty, according to a foreclosure notice. The loan was for the purchase of the 240-unit Northbrooke Apartments Homes in 2022. Mudra Investments is based in Richmond, Texas, and managed by Rahul Patel. The property is located at 17111 Hafer Road in north Houston.
Sutter Ranch
In 2021, Berkeley Point Capital originally provided the $18.2 million mortgage for the purchase of Sutter Ranch, a 228-unit apartment complex at 10445 Greens Crossing Boulevard in northwest Houston. That’s just $79,824 per unit. The lender moved to foreclose on the property last month. The owner is Houston-based GenWealth Capital Group.