Uncertainty emerges about downtown Stamford building's loan

The loan comes due next month for a marquee office building in Stamford, Conn., but recent developments raise questions about the payoff of the debt.

Comprising part of a commercial mortgage-backed security package, a $265 million loan for 400 Atlantic St. has transferred to special servicing, according to credit-ratings agency Fitch Ratings. The entire principal comes due next month because the loan's structure requires only interest payments before the maturity date, according to mortgage-tracking firm Trepp. The loan originated in 2007.

"This loan transferred back into special servicing, as it appears the borrower is not likely to have the financing in place to repay the loan when it comes due next month," said Chris Bushart, senior director at Fitch Ratings. "The special servicer will begin to discuss options with the borrower."

Loans for properties such as 400 Atlantic often go into special servicing shortly before they mature, said Trepp analyst Sean Barrie.

"With the retransfer to special servicing, I think they want to be certain that all possible measures can be taken to find a payoff for it," Barrie said. "The transfer to special servicing doesn't mean they'll default."

The Landis Group owns and manages 400 Atlantic St., although Trepp documentation of the loan does not specify whether Landis holds the loan. A message left for Landis was not returned.

The 400 Atlantic St. loan initially transferred to special servicing in October 2014 and returned as a corrected loan to the master servicer in June 2016, according to Fitch Ratings. The loan was not modified during its first stint in special servicing.

A number of major companies have opened headquarters or major offices at 400 Atlantic in recent years. The building is 15 stories tall and contains 500,000 square feet of office space. The tenant roster includes Charter Communications, Navigators Group, Santander Group, Harman International Industries and Northwestern Mutual.

Built in 1981 as the headquarters for Champion International Paper, 400 Atlantic later served the same purpose for International Paper after IP bought Champion. IP later downsized and moved its headquarters to Memphis, Tenn.

Commercial realtors cite the building as one of the most attractive corporate addresses in the city.

"It's one of the best-located buildings in the market," said Edward Tonnessen, managing director with commercial real-estate firm JLL's Connecticut-Westchester County, N.Y., office.

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