A building in the heart of Union Square may go public due to debt concerns.

Owner T.Hor Equities Group had attempted to refinance or sell the three-storey building, but claimed this could only be achieved by finding a new retail tenant at 152 Geary Street. San Francisco Business Times.

timehall stock looking to refinance The property has an $11.5 million commercial mortgage-backed securities non-performing loan.

The 11,000-square-foot building has not been open to the public since 2018, but it will soon welcome a Banana Republic flagship after parent brand Gap signed a 10-year lease on the entire building last year.

Banana Republic expects occupancy this month, which should make it easier to sell or refinance the property. In another sign that a sale may be imminent, a request for zoning verification was filed with city planners last week, often part of the due diligence process for owners considering a sale.

Lender Morgan Stanley reportedly plans to pursue a “dual-track legal remedy” while continuing to discuss a possible grace period with Thor Equities, which Thor Equities has requested.

The Union Square retail building property was valued at $21 million in a November appraisal, slightly down from the $21.4 million it was loaned in 2012. During that time, the building has been fully occupied by tenants, including men’s fashion designer John Varvatos and luxury consignment boutique Fashionphile.

Thor Equities’ $11.5 million CMBS loan has been distressed since mid-2020 and has since been placed on an industry watchlist for potential default. The building received a notice of default in 2021 in which Fidelity National Title threatened to seize and sell the property in foreclosure if it did not pay Morgan Stanley what was owed.

Pawan Naidu

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