CBIZ Plaza Reverts to Beneficiary at Trustee’s Auction with $20.025m Credit Bid

VIZZDA—October 11^th, 2012 — WBCMT 2006-C27 Office 3101, LLC, and entity formed by US Bank and in care of LNR Partners has taken possession of CBIZ Plaza following a trustee’s auction conducted by Craig K. Williams of Snell and Wilmer. The opening bid of $18m was increased by multiple bidders by more than $2m to arrive at a credit bid of $20.025m or $70.32 per ft². This amount represents a 43.75% write down on the outstanding debt of $35.6m.

CBIZ Plaza is a two building office complex on 3.2 acres at the Northwest corner of Central Avenue and Thomas Road comprised of a 16-story building totaling 266,166 ft² built in 1985 and a two story building totaling 18,604 ft² built in 1980. The complex features a 6-level above grade parking structure with 664 parking spaces and 42 surface parking spaces for a parking ratio of 2.5 spaces per 1000 ft². National Bank of Arizona and a number of major law firms are among the tenants currently occupying the building.

Stephen G. Hearn of Hearn Company previously acquired the property on June 28^th, 2006 for $47.5m or $166.80 per ft² with at least $2m down and $35.6m new debt with Wachovia Bank. On May 3^rd, 2007 that note was securitized and assigned to Wells Fargo. It was subsequently assigned to Bank of America on October 8^th, 2009 and US Bank, the current beneficiary, on February 10^th, 2012. US Bank placed the note in the care of LNR Partners on February 21^st, 2012. Following default by Hearn Company, the property was noticed for trustee sale on June 4^th, 2012. 

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Thirty One-Property Retail Portfolio Reverts from Macquarie/DDR to Wells Fargo Bank

VIZZDA—August 10^th, 2012 – A thirty one-property portfolio purchased by a co-venture between DDR and Macquarie on September 26^th, 2005 for approximately $396.2m from the now-defunct Mervyn’s Department Stores reverted to Wells Fargo Bank at Trustee’s Auction. Wells Fargo was acting in its capacity as trustee for the registered holders of the GE Capital Commercial Mortgage Corp. Commercial Pass-Through Series 2005-C4, with Kevin C. Donahue of CW Capital Asset Management as special servicer. These properties represented less than 20% of the operating assets of Mervyn’s Department Stores at the time of sale and are located in Arizona, Nevada, California and Texas.

The Maricopa County portion of the portfolio was comprised of three properties built from 1988 to 1991 and were acquired for a total of $33.44m. They are as follows:

Address	Ft2	Price	Price/ Ft2
2994 N Alma School Rd	75,804	$8.556m	$112.87
4225 W Thunderbird Rd	86,877	$14.66m	$168.74
6505 E Southern Ave	81,883	$10.428m	$127.43

The portfolio was secured with a $265,687,500 line of credit comprised of a fixed rate note of $212,550,000 and a variable rate note of $53,137,500 with German American Capital Corporation. German American Capital Corporation securitized the debt and assigned it to Wells Fargo Bank on January 26^th, 2012. Wells Fargo selected CW Capital Asset Management as the special servicer and noticed the CMBS debt on February 13^th, 2012. The Maricopa County portion of the portfolio reverted at Trustee’s Auction on August 9^th, 2012 with an $11m credit bid or approximately $44.98/ Ft².

At the time of purchase, all of the properties were leased to Mervyn’s for 15 years firm with a ten-year option to extend. In August 2008, Mervyn’s declared Chapter 11 Bankruptcy and had vacated all sites following Chapter 7 Liquidation by December 31^st, 2008. In early 2010, the Mervyn’s Joint Venture adjusted its holding period projections for the remaining properties triggering $37.6m in impairment charges. In June 2010, the Mervyn’s Joint Venture was served a Notice of Default for failing to make scheduled debt service payments. The properties were placed in court-ordered receivership in August 2010. Due to the non-recourse nature of the loans, this event represents the termination of both obligation and entitlement for DDR from an accounting standpoint, though the resolution remains ongoing.

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BY:

Paul Dionne

Director of Anayltics

pdionne@vizzda.com