Four years after it was purchased for $40 million, a 17-story office tower downtown will be foreclosed on by a lender that said it is owed tens of millions of dollars.
At 1801 Broadway stands Trinity Place, a 197,753-square-foot building that houses La Loma restaurant on the ground floor and Expansive coworking spaces above.
The Chicago-based Expansive, then known as Novel Coworking, purchased the building for $40.2 million in spring 2019. Most of that money, $35.4 million, came from LoanCore Capital, a national real estate lending firm, according to LoanCore.
In a lawsuit Tuesday, LoanCore alleged that the loan matured in April but Expansive still hasn’t repaid it. Expansive owes $34.6 million, plus accruing interest and fees, according to the lender. LoanCore said it now “intends to commence a foreclosure proceeding in Denver.”
“We are working collaboratively with our lender,” said Expansive spokeswoman McKenna Michel, “and remain focused on ensuring that building users remain unaffected.”
In the meantime, LoanCore is asking that a court-appointed caretaker be allowed to manage the property. It recommends Steve Schwab from Cushman & Wakefield’s local office, who was also recently appointed receiver for an office building in Greenwood Village.
Under LoanCore’s proposal, he would be paid $5,500 a month to manage the property, another $3,000 to manage its coworking spaces, and reimbursed $38,750 monthly for administrative and engineering costs. That proposal must first be approved by a Denver judge.
Attorney Craig Allely in the Denver office of Perkins Coie represents LoanCore.
Tuesday’s lawsuit is the second this year involving Trinity Place. In February, State Farm sued Expansive for allegedly ignoring a faulty boiler until that boiler burst and damaged a law office on the 16th floor that State Farm insures.
Expansive denies causing the boiler to burst. A five-day jury trial is scheduled for January.
Expansive owns, rather than rents, its spaces, which is unusual among coworking companies. It has 3.8 million square feet of space in 34 cities, according to its website. In addition to 1801 Broadway, it owns 1630 Welton St. in Denver and 1495 Canyon Blvd. in Boulder.
Expansive is just the latest coworking firm operating in Denver to run into trouble. WeWork has closed one location and downsized two others this summer, and Galvanize will close its sole remaining location in the city come October.