A rising number of office and apartment building owners are falling behind on their mortgages, a sign the economic shutdown is harming stabler property types and raising the prospect of widespread industry damage, the Wall Street Journal reported. Owners of hotels and retail properties were the first to run out of money and start to default back in March, but those types of real estate already looked vulnerable.
- Distress is just starting: In April and May, 354 apartment and office properties started missing payments on $7.1 billion in mortgages, which only includes loans packaged into mortgage bonds. That is up from around $4.2 billion in February and March.
- Whale Building in Brooklyn: Madison Realty Capital is negotiating to hand over the 500,000-square-foot building to its mortgage lender, TPG RE Finance Trust. The owner bought the former industrial building in 2015 and converted it into offices. [WSJ]