Atlas Capital Group's $300 million commercial mortgage-backed securities (CMBS) loan for its mixed-use building in Long Island City has hit special servicing.
The single-asset, single-borrower debt is scheduled to mature in October, according to a report by the Commercial Observer, citing Morningstar Credit.
While the CMBS never faced delinquency since its origination a half decade ago, the building is enduring some hardship. CO stated that mid-year revenues this year would be the lowest in five years, and expenses had spiked 24.3 percent above the level for which the CMBS was underwritten.
When first constructed in 1926, The Factory first started as a furniture warehouse for Macy's. But it has been extensively renovated since and now includes workspaces, a food marketplace, a lounge, an athletic club, bike storage and a breakroom.
The site, located at 30-30 47th Avenue, is within a three-minute walk of the seven train.
In June, the New York City School Construction Authority signed a renewal at The Factory to keep its 75,000 square feet office space. The CO reported the asking rent to be $45 per square foot at the time.
Some other tenants that have operated in the property include the New York City Department of Health and Mental Hygiene, Power Home Remodeling Group, Vanessa’s Dumpling House, Ralph Lauren, Optum Health, Halo Recognition, Gwynnie Bee and Spinmaster.
For August, Trepp reported that overall CMBS special servicing fell by nearly $14 billion to $583 billion month-over-month. However, it's important to note the disparity by property type. For example, Lodging improved by nearly a full percentage point to 9.10, while retail and industrial were steady. Office, meanwhile, climbed to 16.90%, its highest level to date and up from 16.21% in July.
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