Today marks the debut of The Wednesday Wrap, a new weekly feature of the Hartman Simons Commercial Real Estate Blog. The Wrap will present a compilation of recent noteworthy commercial real estate stories from a variety of publications.
Today’s installment will focus exclusively on what was a historic day in Atlanta commercial real estate history. Yesterday, the 55-story Bank of America Plaza, the tallest building in the Southeast, was sold for $235 million at a foreclosure auction to LNR Partners, which held the note on the property. The price represented a breathtaking drop from the $436 million that BentleyForbes paid for the tower in 2006.
Our attorneys featured prominently in the abundant media coverage of the landmark transaction, and we enjoyed sharing our knowledge and industry perspective with the Atlanta Journal-Constitution, 11 Alive and WSB-TV. Here are a few pieces with different takes on the news:
• “Bank of America Plaza Becomes Atlanta’s Priciest Repo” – By Scott Trubey of the AJC.
This article on the nuts and bolts of the deal included some perspective from Hartman Simons partner Gil Burstiner.
Burstiner told reporter Scott Trubey that “the ordeal will help reset market prices for real estate, and the eventual new owner will likely set rental rates at a new or near the bottom and improve the facilities to lure tenants.”
• “Bank of America Plaza: Why It’s Facing Foreclosure Today” – By Doug Sams of the Atlanta Business Chronicle.
This piece presents a detailed timeline showing when and how things went wrong for the tower after its purchase by BentleyForbes.
• “American Foreclosure Bottoms at Atlanta Tower Auction” – By Bloomberg Businessweek.
Looking for some broader context on how this deal may be representative of the Atlanta office market? Bloomberg presents sobering perspective, noting, Atlanta is “now squarely in the bust category with the highest rate of late payments for loans on offices bundled into bonds among the largest U.S. metropolitan areas, at 25.3 percent, according to data compiled by Bloomberg. That's increased from 10.4 percent a year ago and is more than triple the 7 percent national rate.”
• “Bank of America’s Towering Symbol of Foreclosures” – By Dan Freed of The Street.com.
Freed also says the sale is emblematic of Atlanta’s woes during the Great Recession. He writes, “What may also be seen as fitting is that Bank of America is not the biggest loser in this story. That misfortune may go to the city of Atlanta, which was booming just a few years ago and is now one of the cities hardest hit by the crisis. Atlanta recently saw home prices hit a 13-year low and received the second-lowest ranking among 20 cities tracked in the Case-Shiller home price index – second only to Detroit.”