2300 Clayton Road, aka One Concord Center, aka "Zombie Building", a 15 story Class-A building in Concord Ca. has slipped into default.
This is the fourth time since November 2009, and the third time in the past 60 days, that I have posted a local Class-A building going into default. However, this one (as they say) is different. Different because it hits very close to home (literally down the street from our office), and different because it is a property where I have multiple clients, and a tremendous respect for the property management staff.
The story could be a bad horror movie, "Attack of the Zombie Buildings..." that keeps re-playing. It goes like this:
Photo Credit: Susan Tripp Pollard/Inside Bay Area.com
This is the fourth time since November 2009, and the third time in the past 60 days, that I have posted a local Class-A building going into default. However, this one (as they say) is different. Different because it hits very close to home (literally down the street from our office), and different because it is a property where I have multiple clients, and a tremendous respect for the property management staff.
The story could be a bad horror movie, "Attack of the Zombie Buildings..." that keeps re-playing. It goes like this:
- Large investors purchase Class-A building at the top of the market.
- Market crashes - existing tenants close, consolidate, or simply disapear in the middle of the night
- Ownership ends up "underwater", can't refinance, can't adjust rents, can't fund TI dollars
- Brokers start avoiding the building for all the reasons listed above hence - no new tenants
- Ownership stops making payments - building goes into default
