MPG to Walk Away from Downtown Office BuildingFriday, March 16, 2012
Real estate firm MPG Office Trust plans to relinquish ownership of a downtown building because it couldn’t rework the debt financing.
The building, a 54-story office tower, is Two California Plaza at 350 S. Grand Ave. in Bunker Hill. An MPG subsidiary that owns the building is in default for not paying its debt service, but the lender hasn’t foreclosed on the property.
“We no longer believe we will be able to successfully modify the Two California Plaza mortgage loan and retain an ownership interest in the asset,” the company stated in its annual report, filed March 15. “We expect that Two California Plaza will be placed into receivership in the near term pursuant to a consensual agreement and we will focus on an orderly exit from the asset.”
Formerly known as Maguire Properties, MPG reported earnings of $73 million or $1.47 per share for 2011.
By mid-day Friday, shares of MPG declined 6 cents or 2 percent to trade at $2.36 on the Nasdaq.