August 20, 2009
CalPERS is demonstrating why we are still a ways off from seeing the bottom of this “thing”. After joint venturing with Commonwealth Partners LLC to acquire the 355,000 square feet of Class A office space in Portland’s Koin Center building in 2007, the duo have defaulted on the loan and CalPers has made the decision to walk away.
The two paid some $305 psf for the asset.
….Calpers partnership bought the building expecting the property to fetch rents in the $28-to-$32-a-square-foot range annually. Buildings like the Koin Center are signing leases in the mid-$20 range, Mr. Haskins said.
And that’s mid-$20 now. This asset was acquired at the peak, which will make it one of the first to go, but the longer this recessionary decline in rents and occupancy continues, then the distress will stretch into assets acquired in 2006 and 2005, both still huge years for commercial real estate.
- CalPERS Considers Showing Blackrock The Door
- Juniper Networks Renews 425K SF Headquarters Lease
- MacFarlane Quits CalPERS; Stockbridge In
- Tishman Walks on Stuy Town
- Bordeaux Centre Taken By Lender