Just a few years ago it seemed like Las Colinas was nearly invincible. Now, fast forward to 2010 and the unthinkable is taking place: a Four Seasons hotel heading toward foreclosure.
The Latest Casualty in the Dallas Commercial Foreclosure Crisis
With a mounting $183 million in debt, the Four Seasons is just the latest casualty in the Dallas commercial real estate market. This pristine property, which is also the site of the annual Byron Nelson golf tournament, is owned by Bently Forbes, who missed a scheduled loan payment in November and is hoping the lender will either decrease the interest rate on the loan or renegotiate lower loan terms.
Bently Forbes owns three other blue chip properties in the Dallas-Fort Worth area, including the Preston Commons Shopping Center, the Sterling Plaza and Park Center. Although the Four Seasons is a separate entity from these other properties, it is estimated that the cost of a Chapter 11 bankruptcy could cost nearly $100,000.
Blue Chip Properties at Risk
Many Dallas commercial real estate experts are not surprised to find that many blue chip properties are heading toward foreclosure, given the fact that property taxes for commercial real estate properties were due in January; this could mean that many property owners simply can’t make these tax payments due to the downshift in the economy in 2009. The struggle to pay property taxes could mean disaster for many Dallas commercial real estate properties.
Another famed property that is experiencing its own set of problems in the Mosaic in downtown Dallas. This property had original mortgages totaling $66.5 million.
The Mounting Commercial Property Debt in Dallas
The foreclosed properties in Dallas currently have more than $900 million in debt, and include properties such as office buildings, shopping centers, hotels and warehouses. There are currently 250 Dallas commercial properties in foreclosure, and that number is expected to continue climbing throughout 2010 before leveling off sometime next year.