A distressed $410 million loan on One & Two Prudential Plaza is facing an appraisal-related downgrade that implies additional losses, according to Barclays.
The March remittances report shows the December 2012 appraisal of the property at $317 million marks the value down by 40% compared to the last 2008 appraisal, analysts wrote.
And that may imply “a 20% discount to the outstanding loan balance.”
The loan went into distress and was transferred to
Analysts had estimated then that the loss of these tenants would push occupancy down to 65% “and would likely lower NCF below debt service.”
Meanwhile, according to the loan servicer, the borrower has hired a third-party consultant who has proposed an A/B split because the new appraisal could be used as the basis for a future A/B split.
“Historically we have seen hope notes split roughly at 100%-110% of the latest appraisal, which would imply a $70 million to $80 million B-note split between the two deals,” analysts wrote.
