The Jamison Properties-owned office building at 811 Wilshire Blvd., Los Angeles, has entered foreclosure proceedings following a failed sale in downtown LA. Located near the intersection of Wilshire Boulevard and Flower Street, the 21-story building spans 337,000 square feet.
According to commercial real estate outlet The Real Deal, Jamison had secured a buyer and paid a deposit toward mortgage repayment, but the transaction collapsed, prompting the lender to take legal action. The building’s outstanding loan balance stands at approximately $35 million, down slightly from the original $39 million mortgage. The lender is currently reviewing a potential CMBS (commercial mortgage-backed securities) debt restructuring plan.
The property, which experienced a subterranean explosion in 2015, was listed by commercial real estate firm CBRE for its redevelopment potential, including the building and an adjacent parking lot. The off-market transaction did not disclose the buyer’s identity or reasons for the deal falling through.
Jamison purchased the building in the early 2000s for $26.5 million, and in 2014, the building was appraised at $68 million at the time of a prior loan. Current estimated value is around $40.5 million, still exceeding the loan balance.
The failed sale is expected to increase Jamison’s financial strain, as the company holds roughly $200 million in distressed debt this summer. With low occupancy rates and high vacancies, any future sales attempt carries significant uncertainty for investment recovery.
The downtown LA office market has seen several instances of building valuations falling below loan amounts. For example, the Wedbush Center was appraised at $60.5 million, less than half of its $128 million loan, while Brookfield Properties’ Figueroa at Wilshire Office Tower sold for $210 million, below a $250 million loan.
Currently, the building’s occupancy rate is around 36%, highlighting ongoing challenges in downtown LA’s commercial real estate market.
BY EUNYOUNG LEE [lee.eunyoung6@koreadaily.com]
