Philadelphia, PA.  $368 Million SASB Loan (JPMCC 2020-MKST) faces total loss after judge approves sale.  The sale of Philadelphia’s largest office complex of 1.8 million square feet located at 1500 Market Street has been approved for sale for $70mm ($39/sf) to a group led by Dean Adler.  The intent is to convert the two towers to residential and hotel with a modest component of office space.  

The loan’s Special Servicer has advanced ~$60 million for interest and expenses.  Net of closing costs and these advances, there are anticipated to be no funds (or de minimus funds) for the CMBS trust’s original $368 million loan, meaning a total, or near total, wipe out.  

Losses in office properties like this are leading overall recent CMBS losses.  Expect more to come as these dated properties face their day of reckoning.