Posted on 10/23/2023 7:35:22 PM PDT by dynachrome
NEMA, one of San Francisco’s largest apartment buildings, has lost almost half its value in five years as it faces an “imminent default” risk on its mortgage, according to a new report.
The 754-unit apartment tower was valued at $543.6 million in 2018 but is now valued at $279 million by real estate data firm Trepp. That’s below the value of owner Crescent Heights’ $384 million mortgage, an ominous sign indicative of the Mid-Market area’s struggles.
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Crescent Heights didn’t immediately respond to a request for comment, but said in August that “the property’s cash flow can no longer cover the monthly debt service,” according to Trepp. The developer could lose control of the property if it becomes late on mortgage payments and lenders seek to foreclose.
San Francisco landlords have struggled with mortgage payments or given up properties around downtown, including at the San Francisco Centre mall; the Parc 55 and Hilton Union Square hotels; and a huge portfolio of apartments owned by Veritas.
NEMA, at 8 10th St., is next to two major office buildings that have emptied during the pandemic: 1355 Market St., where X (formerly Twitter) slashed most of its staff following Elon Musk’s acquisition; and, to the west, 1455 Market St., which lost its two anchor tenants, Uber and Block.
(Excerpt) Read more at sfchronicle.com ...
Might I ask, is the owner being sued by the state AG’s office over the asset’s inflated value?
Derelicts living free to keep them off filthy sidewalk tent encampments claim the room service is slow and the narcotics delivered are mostly cut with cornstarch or talcum. And the Netflix and Paramount Plus service on the 80 inch HD TVs keeps going off and on.
They may demand a better building.
Badaboom....
All part of the plan. In two years the value will be $80 million and some globalist will buy the entire neighborhood.
I love a happy ending
I’m not unhappy to see the people of San Francisco, who decade after decade are so stupid they elect literally retarded morons,... take one more punch in the gut.
I am unhappy to see private enterprise take one more liberal/marxist/socialist, democratic party punch in the gut.
It’s what they voted for.
No need for them to worry. Our government will rent the place out to house illegals.
I say, let the Chinese buy it all up.
The only catch is, they have to patrol the streets with Chinese cops. Mostly, because it would be entertaining to watch Chinese police deal with San Fran's looters, drug addicts, and thieves.
“ All part of the plan. In two years the value will be $80 million and some globalist will buy the entire neighborhood.”
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Have evaluations for determining property taxes correspondingly gone down?
I suspect NOT.
Better put owner in jail, unless it is a Democrat.
San Francisco is a literal turd bowl.
And they can’t figure out how to clean it up.
If you owe the bank $1 million and can’t pay, you have a problem. If you owe the bank $100 million and can’t pay, the bank has a problem.
This place, on 10th St., is a very poor location. I walked right by it in May.
There were hopes, during the techbro boom pre-Covid, that it could be gentrified. That is gone for now.
I do understand your meaning but I’m having a hard time caring all that much, it IS what they voted for.
There is a game afoot here. The borrowers are well-positioned to re-negotiate.
Or some bottom fisher could buy for a bargain price. Banks and other lenders do not like to own real estate. REO (“Real Estate Owned”) is usually sold at a loss by the lenders.
The Chinese have bought a lot of SF. Most of this was capital flight funds (anything to get assets out from under the Chinese government). But I think they have already lost a lot on money on their investments.
The current state of SF isnt going to attract more investment, from the Chinese or anyone else.
Note “the Chinese” arent a collective body. These investors are unconnected individuals. They have no organization. Certainly not the Chinese government, which wants to repatriate their assets.
Okay but, this is an apartment that should be better than 98% occupied and rents haven’t been reduced.
So what gives?
I don’t get it.
The current value has nothing to do with the loan amount, the rents at the time of possession and surely, the rents have been raised since
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