According to November servicer watchlist notes, accounting and financial advisory firm Ernst & Young has extended its lease at 1101 New York Avenue NW in Washington D.C. The property backs the $212.1 million 1101 New York Avenue loan, which is split between a $106 million note (4.9% of MLMT 2007-C1), and another $106 million piece that represents 5.5% of BSCMS 2007-PW17.
The collateral is a Class A office building that spans 374,033 square feet and was built in 2006. Ernst & Young is the building’s top tenant, as it occupies 30.6% of the NRA. EY’s lease previously expired in June 2017, but the firm has now extended until 2028. (Servicer data does not yet reflect this, only the watchlist notes do.)
The loan was added to the watchlist due to a low DSCR below the required threshold. As of the third quarter, DSCR (NCF) is 0.87x at 86% occupancy, compared to 0.90x at the close of 2015. The decrease in DSCR is due to an increase in janitorial and repair maintenance expenses.
Both notes are current and are slated to mature in July 2017.
Compliments of Trepp – a member of the EACCNY