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CRE Dominoes: 8000 Marina Blvd Defaults

November 12, 2009

8000 Marina Blvd8000 Marina Blvd, the 193,519 square feet Class A office project in Brisbane has gone into default. The building was acquired by Broadway Partners in 2006 for approximately $54M ($280 psf). Broadway, on its website is reporting that it disposed of the asset in August of 2007 though we’re not quite sure to who. The default amount is roughly $58M, on a loan that was seemingly originated in 2007 for $63M. The asset is currently seeing roughly 30% vacancy, and asking rates are $2.75 FS on direct space. Current metrics and leasing indicate an asset value roughly 35% below that of the last verifiable trade.

The current mailing address for taxes though is┬ánone other than the ever-present 85 Broad Street, which is Goldman Sachs’ headquarters. The lender is listed as Baker Hostetler, which is a law firm indicating that it is a CMBS loan. That must be a fun deal to work on.

Anyhow, the rent and vacancies speak for themselves, and really highlight the disparity between where the market and values are now, and where they were anticipated to be. Just look at Jack Myer’s Centennial Towers. Recall the articles where the developer was expecting $5.00 NNN rents at that project? That really was something when it would have been difficult to find any substantial leasing comps at even $3.00 NNN for office space (not biotech) in Brisbane or South San Francisco.

Anyhow, 8000 Marina was was built in 2000, features 8-stories of Class A office space, and is located just south of San Francisco and is part of the Sierra Point master planned development. We’ll see what happens, but once this deal gets digested by the market, it’ll again be a case of “new basis, new rents”, putting pressure on other projects.

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Categories: Commercial Finance and Lending | Commercial Real Estate Investing | Notable Deals
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Ken November 12, 2009

Centennial Towers was built by Myers Development, not Wilson Meany Sullivan

squarefeet November 12, 2009

thanks for the catch Ken and fixed. Confused the two, though I believe WMS is providing the prop mgmt for the project.

inclinejj February 17, 2010

Wednesday, March 10, 2010

09-00782-4C 8000 Marina Boulevard, Brisbane, CA 94005 $53,805,316.94 No Opening Bid 12:30 PM 12:30 PM

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