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Upstate New York Loan Off to Special Servicing

According to fresh January remittance data, the $35.5 million Great Northern Mall loan is now with the special servicer. Great Northern Mall is a four building, 900,000 square-foot enclosed mall in Clay, New York, a suburb of Syracuse. Due to mature last month, the loan accounts for 18.8% of the collateral balance in BSCMS 2004-PWR3.

Two of the four buildings, totaling 504,743 square feet, serve as collateral for the loan. Dick’s Sporting Goods, Regal Cinemas, and The Shoe Department are listed as the top three tenants. Through the first three quarters of 2013, DSCR was 1.36x, down from 1.50x for the year in 2012 and 2.19x at securitization. Occupancy was 75% as of September 2013 and the loan is currently paid through December 2013.

The loan was due to mature in December but there are no special servicer comments available in this rolling period. The only mention in the January remittance data is a new servicer workout code, which indicates an extension is the current strategy.


Philadelphia Office Hit with Appraisal Reduction

January remittance data shows a $10.97 million appraisal reduction amount for the $28.32 million Graham Building loan. The new reduction indicates a possible 39% loss for the loan, without accounting for liquidation expenses and repayment of advances. The note backs 1.5% of BACM 2006-4.  A 39% loss would send losses a third of the way through the originally A- rated G class and boost cumulative bond loss on the deal to 7.4%.

The Graham Building defaulted a month after its original maturity date of July 2013. The current workout strategy is listed as foreclosure, but special servicer comments indicate that a proposed discounted payoff is under review as well. First half 2013 DSCR tumbled to 0.84x from 1.04x in 2012 and 1.32x at securitization.

An appraisal done in October of last year valued the 240,634 square-foot office building in Philadelphia, Pennsylvania at $20.2 million, well below the “as-is” 2007 appraisal of $35.4 million. The loan was fully interest-only and the borrower failed to secure refinancing according to special servicer commentary.

Compliments of TREPP, LLC – A EACCNY Memer