$44.3M Fair Oaks Plaza Loan Delinquent for First Time

Fair Oaks Plaza

The $44.3 million loan on Fair Oaks Plaza, a 179,688 square foot office building at 11350 Random Hills Road in Fairfax, VA, has become 30 days delinquent for the first time, according to August remittance data, as reported by Trepp.

Located at the intersection of routes 66 and 51, the building has seen its Debt Service Coverage Ratio drop from 0.94x in 2011 to 0.88x in the first quarter of 2013.

The loan on Fair Oaks Plaza was transferred to a special servicer in July. The special servicer has reported that the loan was facing “imminent default due to borrower’s inability to make the monthly payments.”

The building was 85 percent occupied at the end of the first quarter this year. Its largest tenants are listed as HQ Global Workplaces, Inc. (8/31/2016 expiration), Harrity & Harrity LLP (4/30/2019 expiration) and McCandish & Licard (9/30/22 expiration).

A pro-forma appraisal done at securitization in 2007 valued the building at $58 million, relative to an “as-is” value of $53 million at that time, according to Trepp. The loan is due to mature in early 2017 and is locked out until late 2016.

Commentary on the watch list blames uncertainty surrounding the federal government’s debt/deficit issues and the potential impact on government spending for sluggish leasing. The notes also say that the borrower has initiated tours with multiple small users, but no current proposals are close to materializing.

The property, constructed in 1985, received approximately $1.4 million in renovations during 2009.