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
