$77M Royal Centre Loan Transferred to Special Servicer

11700 Great Oaks Way

The $77 million loan on Royal Centre in Alpharetta, GA, three office buildings totaling 623,060 square feet, has been transferred for special servicing due to imminent default, according to Fitch.

The Royal Centre Loan was originated on May 16, 2007 by Principal Commercial Funding II, LLC. The borrower was CH Realty IV/Royal Centre, L.L.C., which is 100% owned by CH Realty Investors IV, L.P., an affiliate of Crow Holdings.

The asset was appraised for $103.1 million at the time of the loan securitization.

According to data provided by Trepp, the loan is current but was on a watchlist. The watchlist notes say the property's occupancy in January 2012 was at 80.7 percent with rental rate of $16.52 per square foot, which was down from 86.94 percent and $21.14 per square foot, respectively, in the first quarter of 2010.

The most recent watchlist notes from July suggest that occupancy has fallen to 68.9 percent.

"The borrower is continuing to aggressively market vacant spaces," says the Watchlist notes. "They are offering concessions and rent abatements for quality leases."

The Royal Centre Property is located at 11575, 11475, and 11700 Great Oaks Way, south of Old Milton Parkway and east of Georgia Highway 400. The Royal Centre Property is located in the Royal Centre Office Park development which is 27 miles north of downtown Atlanta.

The Royal Centre Property was originally constructed in 1998 and 2000. It consists of 623,060 square feet contained in three buildings. One building contains 150,643 square feet in three stories, another building contains 168,530 square feet in four stories, and the third building contains 303,887 square feet in six stories. The Royal Centre Property is situated on approximately 37.6 acres and includes 3,321 parking spaces.

Onsite amenities include a full service cafe, ATM, onsite walking trail, and security and camera monitoring with card key access.

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