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Tishman Speyer misses $450M CMBS deadline on D.C. office property
The International Square loan matured Aug. 10, and occupancy has fallen sharply since the CMBS issuance in 2016, with the Federal Reserve planning to exit more than half its space.
Tishman Speyer failed to repay a $450 million CMBS loan by its maturity date on its large Washington, D.C. office complex International Square, according to special servicer commentary cited by Bisnow. The property, a 1.2 million square foot set of interconnected buildings near the Farragut West Metro station, reached maturity on Aug. 10, the outlet reported.
Bisnow said the complex’s occupancy has deteriorated since the loan was securitized in 2016. The Federal Reserve, the largest tenant, has said it will move out of more than half of its space, and Morningstar Credit commentary shows the $166.7 million of Class A shares and Class A bonds were rated AAA at securitization but later downgraded to BB, indicating a higher risk profile.
The property entered special servicing in May after the Federal Reserve Board issued termination notices tied to leases expiring between 2028 and 2029, Bisnow reported. Torchlight Loan Services did not respond to a request for comment, according to the outlet.
Bisnow also reported that while workout discussions are likely, stabilizing International Square will be challenging given the building’s size and the broader difficulty of the D.C. office market. An S&P Global report cited by the outlet put occupancy at 70% as of last September, down from 94% in 2016.