Two office buildings north of Dallas have gone into foreclosure, spotlighting suburban distress.
Lenders have foreclosed on the eight-story One Hanover Park building at 16633 North Dallas Parkway and the 378,000-square-foot Princeton office complex at 14651 North Dallas Parkway, the Dallas Morning News reported. Both properties are in Addison, roughly 15 miles north of downtown Dallas.
The 196,000-square-foot One Hanover Park, built in 1998, has been owned by a Houston-based investor since 2014. New York Life Insurance foreclosed on the property after the landlord defaulted on nearly $32 million issued in 2018. New York Life listed the building’s value at nearly $22 million in the deed transfer, while its valuation for property taxes stands at nearly $28 million.
The building has an occupancy rate of about 50 percent, with tenants including State Bank & Trust, Fidelity Information Services and Metavante Corp. The property’s low valuation and high vacancy rate reflects the beleaguered state of Dallas-Fort Worth’s office sector, which has been plagued by the pandemic-fueled remote work era, rising interest rates and a tough lending environment.
The Princeton complex, meanwhile, was foreclosed on by Liberty Bankers Life Insurance. The landlord, a Dallas-based partnership that’s owned the property since 2004, was in default on more than $35 million in debt, prompting Liberty to seize the complex on Nov. 10, the outlet reported. The complex, which consists of two connected buildings, was constructed in 1980 and has an assessed value of more than $27 million. It had been listed for sale by Colliers International.
Despite a 2018 renovation, the property has struggled to maintain healthy occupancy levels and is 60 percent leased. Tenants include Studio TLA, Devadoss Law Firm, Kidscare Home Health, Securus Technologies, Vitas Healthcare and Sagemcom USA.
Earlier this week, a December foreclosure was scheduled for another Dallas office building, the 12-story, 253,000-square-foot Uptown Tower at 4144 North Central Expressway, after the landlord, a Houston-based real estate investment trust, defaulted on a more than $14 million loan.
The 18-story office tower at 211 North Ervay in downtown Dallas and the 6400 Legacy building in Plano have also been threatened by foreclosure.