Bank of America Plaza, the tallest building in metro Atlanta, is a step closer to going back to its lender.
A company that specializes in troubled loans is making preparations for a possible foreclosure while negotiations continue on a deal to try to prevent the property from being seized by the lender, according to a report by Trepp, a real estate research firm.
California-based commercial real estate investment firm BentleyForbes bought the 55-story tower at the height of the real estate boom for an Atlanta-record $436 million. It has been working to avoid default.
The main $363 million loan on the tower went to a special servicer LNR Partners in February, while a second loan had been in default for non-payment.
"BentleyForbes has remained in active dialogue with LNR on matters relating to Bank of America Plaza since the firm was appointed as special servicer for the tower," BentleyForbes executive vice president Brent Ware said in a statement. "The communication has been continuous and consistent, including interactions as recent as this week. BentleyForbes remains committed to working with its financial partners on a way forward at Bank of America Plaza that will stabilize the tower's underlying long-term capital structure, and this process remains ongoing at this time."
LNR did not return calls for comment.
A possible foreclosure of Bank of America Plaza comes as delinquency rates for commercial mortgage backed securities, or CMBS, a type of loan for commercial properties, reached an all-time high in metro Atlanta last month, according to Trepp.
With a $12.8 billion CMBS balance outstanding, $2.73 billion, or 21.3 percent was 30-plus days delinquent or worse -- compared with 13.2 percent in December 2010. Trepp said.
If a buyer could snap up the tower at a major discount, they could offer space at below market rent -- a major competitive advantage, said Ronald Glass, a principal at GlassRatner Advisory & Capital Group.
"There is a lot of capital on the sidelines ... looking for opportunities," Glass said.
