Roosevelt Lofts Sale to Conclude Downtown's Bankruptcy Boom
Eric Richardson
[Flickr]
The Roosevelt sales center has instead been a leasing office for much of the last two years while the project navigated bankruptcy.
DOWNTOWN LOS ANGELES — The last of Downtown's major residential bankruptcies should move an important step closer to resolution this week as Bank of America's interest in the Roosevelt Lofts is sold to national multifamily real estate company Greystar for $68 million.
That number represents a loss for the bank, whose original loan to the 222-unit development at 7th and Flower was for $78 million.
While the payment will give Greystar the building's loan, it does not directly transfer ownership of the property. That change would take place via an auction sale on August 30. While other interested parties would be able to bid in that sale, Greystar would most likely acquire the project thanks to its ability to credit bid the entire $78 million note.
The Roosevelt Lofts filed its Chapter 11 bankruptcy case on April 13, 2009. It has been renting units since October of that year, and fought unsuccessfully to sell off some units to fund a plan that would keep the original developer in place.
The eventual sale would bring a close to a two-year period in which Downtown's residential market endured a half-dozen major bankruptcy cases.
Title Guarantee: Filed on February 23, 2009. Bank of America was able to foreclose in October.
Brockman: Filed for Chapter 7 liquidation in April of 2009. Bank of America eventually acquired the building, and currently has it listed for sale.
Concerto: Entered Chapter 11 bankruptcy in September of 2009 as developer Sonny Astani attempted to free up sales that had been frozen when his lender was taken over by the FDIC. After a long and very public fight with the Starwood subsidiary that purchased the loan, Astani sold off his interest in February.
705 W. 9th: The 35-story 705 W. 9th entered bankruptcy in September of 2009, months after its developer, Meruelo Maddux, declared for its own Chapter 11 case. The tower was sold to Watermarke Properties in April, 2010, for $110 million. It is now known as the WaterMarke Tower.
Meruelo Maddux: Meanwhile, that Meruelo Maddux case continued. The developer reached a deal to sell Union Lofts in June, but was not able to complete the sale before its top officers were replaced as part of a lender-proposed reorganization plan.
David McBane on August 02, 2011, at 12:16PM – #1
The next wave is all the condo buildings that went rental going back to condos once the economy improves (maybe in 2013?). I think it is going to be years before we see new residential construction/adaptive re-use conversions, which is a shame. Downtown needs as many residents as it can get.
Illithid Dude on August 03, 2011, at 09:35AM – #2
Actually, Daniel, there has been a steady stream of new Adaptive Resuse projects in Downtown over the past couple of years, and new condo construction is going to start to pick up next year with One Santa Fe and Wilshire Grand. So, Downtown will be getting the steady stream of new residents that it needs.
David McBane on August 03, 2011, at 03:05PM – #3
@Illithid Dude - There have been very few new adaptive re-use developments and those that have started now were either too far along to not convert or something weird is going on (I'm looking at the conversion along Broadway, I think, where the owners seem to be flouting notice laws).
One Santa Fe and Wilshire Grand are new developments but that's about it besides the new apartment tower on 11th(?). I should have been explicit that when I said "years before we see new residential construction/adaptive re-use conversions", I meant at a good pace. Basically, I think it is going to be a trickle for the next few years.