MPG Plans to Give Up 500,000 SF in BreaREAL ESTATE: Rest of holdings here distressed or on sales block Saturday, March 24, 2012
MPG Office Trust Inc.’s wild run as an Orange County landlord looks set to effectively end next month, when the Los Angeles-based company plans to dispose of two large office campuses it owns in Brea.
The real estate investment trust disclosed in recent regulatory filings that it intends to turn over Brea Corporate Place and Brea Financial Commons to its lender on or before May 1.
The two office campuses include five buildings that total about 500,000 square feet just west of the 57 (Orange) Freeway.
The properties have close to $109 million of debt tied to them, or roughly $220 per square foot. They are currently the only OC offices owned by MPG that are not up for sale or in special servicing.
MPG bought the Brea campus in 2007 when it operated under the Maguire Properties Inc. name. It had extended the maturity date of a non-recourse mortgage loan on the Brea properties a few times in recent years, with the most recent putting it at May 1 of this year.
No Extension Plans
There are no plans to extend the loan again or try to refinance the project, MPG disclosed in its recently filed annual report with the Securities and Exchange Commission.
“We expect to deliver title to the property to the lender on or before the maturity date of the loan,” the company said in the regulatory filings.
The name of the lender for the complexes was not disclosed.
MPG said it expects that the loan “will be settled in a non-cash manner at the time of disposition.”
The two properties are on opposite sides of South State College Boulevard, near the intersection of East Birch Street, and include a pair of six-story offices along with three low-rise buildings.
The two-building Brea Corporate Place, which has a little more than $70 million of debt tied to it, runs about 330,000 square feet and is 75% leased, according to the landlord. It was about 93% leased when Maguire bought the property in 2007.
Brea Financial Commons, which has about $38.5 million of debt tied to it, runs another 165,000 square feet. The three-building complex now is about 91% occupied. The complex was 99% full at the time it last changed hands.
MPG is Brea’s second-largest landlord for high-end office space, behind Newport Beach-based Olen Properties, which owns close to 700,000 square feet of buildings in the city.
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