It looks like a loan for Reno City Center, and essentially the project itself, will be put up for auction on September 12, on the Supreme Courthouse steps in New York City.
A press release sent out states:
JLL has been retained by Delphi CRE Funding LLC, as Administrative Agent (the “Secured Party”) to offer for public sale all right, title and interest of Reno City Mezzanine Borrower, LLC, a Delaware limited liability company (the “Debtor”), in the following collateral: (i) all limited liability company interests in Reno City Center Owner, LLC, a Delaware limited liability company (the “Mortgage Borrower”) and (ii) all other collateral pledged by the Debtor under that certain Mezzanine Pledge and Security Agreement, made by the Debtor in favor of the Secured Party, dated as of June 16, 2022 (the “Pledge Agreement”) (items (i) and (ii), collectively, the “Collateral”). The Secured Party was granted a security interest in the Collateral to secure certain indebtedness (the “Indebtedness”) of the Debtor.
Based upon information provided by the Debtor, the Mortgage Borrower and/or certain other persons and entities affiliated therewith, it is the understanding of the Secured Party (but without any warranty or representation by the Secured Party as to the accuracy or completeness of the following matters) that: (i) the Debtor owns all limited liability company interests in the Mortgage Borrower, (ii) the Debtor indirectly owns the fee simple interest in the property known as Reno City Center, Reno, Nevada (the “Premises”), and (iii) the Premises are subject to a first mortgage loan securing indebtedness in the original principal amount of One Hundred Thirty-Eight Million Three Hundred Seventy-One Thousand One Hundred Eighty-Seven And No/100ths Dollars ($138,371,187.00) (the “Mortgage Loan”), which loan may be in default, including with respect to a default under Section 7.1(n) of the loan agreement for the Mortgage Loan.
The Collateral will be offered for public sale on September 12, 2023, beginning at 11:00 A.M. (prevailing Eastern Time) both via Zoom (or a similar online platform) and in-person in front of the New York Supreme Court, New York County Courthouse, located at 60 Centre Street, New York, New York 10007. Secured Party reserves the right to reject any or all bids and terminate or adjourn the sale to such other date and time as the Secured Party may deem proper, by announcement at the place and on the date of sale, and any subsequent adjournment thereof, without further publication.
An unfortunate end to this chapter of a project that would have rejuvunated an entire quadrant of downtown. Let's hope someone scoops up this half-finished project and finishes it as envisioned, or creates a new plan for this 1 million sf property.
The question I have is, there were two loans for this property, so what happens to the first loan? If you buy this loan at the auction, do you get the project? The other loan just defaults?
Maybe this is CAI Invesment's portion of the loan, which is being sold off because they are pulling out? So many questions!
Perhaps the Reno Housing Authority could bid on it. Would certainly help our housing shortage! Here's a link to register for the auction, if you have some money and want in on it!