The exterior of the office tower at 410 17th St. in downtown Denver. Many of its floors are vacant. (Thomas Gounley/BusinessDen)
The loan backed by a downtown Denver office tower in foreclosure has sold at a massive discount, a move expected to eventually give the buyer ownership of the structure.
California-based Cress Capital purchased the loan backed by the 24-story 410 17 St. tower on Feb. 29, according to public records.
The loan was originally made in 2019 for $113 million. As of July, when the original noteholder filed to foreclose, $96 million was still owed.
The assignment of deed of trust recorded by Denver in February does not indicate the price paid. A source familiar with the deal told BusinessDen it was sold for around $20 million.
Cress did not respond to requests for comment from BusinessDen. Cress Managing Partner Ryan Parkin told Bloomberg, which first reported the purchase, that the firm bought the loan at “a major discount” for a “level approaching or at the pre-Covid land value.” The 410, as the 435,000-square-foot tower is known, sits on about 0.86 acres.
Parkin told Bloomberg that his firm expects to invest $1 billion in office buildings in the next 18 months.
The 410 is owned by an LLC described as a joint venture between Steelwave and Rialto Capital Management, which paid $127.25 million for the property in 2019.
The owners financed the acquisition with the $113 million loan from an affiliate of Ares Commercial Real Estate.
For about 40 years, one of The 410’s marquee tenants was Brownstein Hyatt Farber Schreck. But the powerhouse law firm moved its headquarters to Block 162 early last year.
When Ares filed to foreclose last year, the lender said the owner “had defaulted on the loan due to the failure to make timely payments of principal and interest when due.”
As the new owner, Cress can opt to foreclose on the property itself or reach a deal with the current ownership to take the building in lieu of foreclosure.
Read more (newly updated): Troubled towers: Breaking down Denver’s distressed office properties
The exterior of the office tower at 410 17th St. in downtown Denver. Many of its floors are vacant. (Thomas Gounley/BusinessDen)
The loan backed by a downtown Denver office tower in foreclosure has sold at a massive discount, a move expected to eventually give the buyer ownership of the structure.
California-based Cress Capital purchased the loan backed by the 24-story 410 17 St. tower on Feb. 29, according to public records.
The loan was originally made in 2019 for $113 million. As of July, when the original noteholder filed to foreclose, $96 million was still owed.
The assignment of deed of trust recorded by Denver in February does not indicate the price paid. A source familiar with the deal told BusinessDen it was sold for around $20 million.
Cress did not respond to requests for comment from BusinessDen. Cress Managing Partner Ryan Parkin told Bloomberg, which first reported the purchase, that the firm bought the loan at “a major discount” for a “level approaching or at the pre-Covid land value.” The 410, as the 435,000-square-foot tower is known, sits on about 0.86 acres.
Parkin told Bloomberg that his firm expects to invest $1 billion in office buildings in the next 18 months.
The 410 is owned by an LLC described as a joint venture between Steelwave and Rialto Capital Management, which paid $127.25 million for the property in 2019.
The owners financed the acquisition with the $113 million loan from an affiliate of Ares Commercial Real Estate.
For about 40 years, one of The 410’s marquee tenants was Brownstein Hyatt Farber Schreck. But the powerhouse law firm moved its headquarters to Block 162 early last year.
When Ares filed to foreclose last year, the lender said the owner “had defaulted on the loan due to the failure to make timely payments of principal and interest when due.”
As the new owner, Cress can opt to foreclose on the property itself or reach a deal with the current ownership to take the building in lieu of foreclosure.
Read more (newly updated): Troubled towers: Breaking down Denver’s distressed office properties
