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LOS ANGELES-Maguire Properties says that it will no longer continue to pay the mortgages for six properties that the company owns in Los Angeles and Orange counties and that it entered into a deed in lieu of foreclosure last week with the lender to dispose of a seventh property, Park Place I in Irvine. The L.A.-based office REIT says that it has contacted the master servicers of the mortgage loans encumbering the other six properties and has notified them that it “will no longer continue to fund the cash shortfall associated with the respective mortgages.”

Park Place I and the six other properties, one of which is Park Place II, total more than 4.5 million square feet combined. The Park Place I and II properties total more than two million square feet. The five other properties are the 264,000-square-foot Stadium Towers in Central Orange County, the 308,000-square-foot 2600 Michelson Dr. in Irvine, the 827,000-square-foot Pacific Arts Plaza in Costa Mesa, the 622,000-square-foot 550 S. Hope in Downtown Los Angeles and the 334,000-square-foot 500 Orange Tower in Central Orange County.

Maguire on Monday morning was conducting a conference call regarding its financial results for the second quarter ended June 30, in which the company reported a net loss of $380.5 million and $7.95 per share. On an FFO basis, it lost $339.7 million and $7.10 per diluted share.

Nelson Rising, president and CEO of Maguire, said in a statement that the plan to default on the loans, along with other plans approved by the company’s board, “will eliminate the adverse effect these assets have had on the Company’s cash position.” During the quarter ended June 30, 2009, the company recorded a non-cash impairment charge of approximately $345 million associated with the assets.

In the company’s conference call, Rising said that the borrowers for six of the seven properties were all special-purpose entities formed for the purpose of owning and operating an individual property, and those six were all financed with CMBS loans. The seventh property, Park Place I, was financed by a balance-sheet lender.

Maguire’s plan to discontinue payments on the mortgages is the latest chapter in the REIT’s efforts to get out from under a huge load of debt, much of it taken on when the company acquired a portfolio of EOP Office properties from Blackstone. The REIT has been selling off assets as part of its debt-reduction strategy and has been marketing all of its Orange County properties for some time and recently sold two more of them, City Parkway in Orange and 3161 Michelson Dr. at the the Park Place campus in Irvine.

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