A mortgage note on the complex's largest office development site has been put up for sale, the Business Journal is reporting. The development is entitled for nearly 2 million square feet of office and commercial space, and was expected to be built out over several years.
According to sources with knowledge of the situation, the mortgage has a balance of more than $150 million and is held by a consortium of lenders led by KeyBank of Cleveland. The note is expected to fetch roughly $50 million; a sale for that amount could represent a write-down of at least two-thirds. A payment of about $150 million was due on the mortgage this summer, but New York-based Tishman Speyer and Chicago-based Walton opted to not pay it. They bought the property in February 2007, near the height of the market, and commercial real estate values have since crashed. Rather than foreclose and take over the property, the lenders decided to sell the note, according to a source.