An apartment building in San Francisco has reportedly experienced a large decrease in its value compared to where it stood in 2018.
The San Francisco Chronicle, citing data from Trepp, reported Thursday that the building, the Crescent Heights-owned NEMA, had its value decline by $264.6 million, hitting $279 million, more than a 48% drop from 2018, when it was worth $543.6 million.
Trepp had also tweeted about it Wednesday. The company, which tracks structured finance, commercial real estate and banking markets, said the commercial mortgage-backed securities (CMBS) loan connected to it was $384 million.
The Mid-Market area of San Francisco, where the headquarters of X (previously known as Twitter) and other office buildings are located, houses NEMA. The roughly 10-year-old building has 37 floors and 754 rental units, according to the Crescent Heights website.
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The change comes just a couple months after another Trepp report indicated the NEMA could potentially have to contend with foreclosure from a mortgage default, according to the San Francisco Chronicle and the San Francisco Business Times. Special servicing reportedly received the loan.
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An aerial view of the San Francisco skyline on May 30, 2023.
FOX Business reached out to Crescent Heights for comment but did not receive a response by the time of publication.
San Francisco and its real estate markets have been working to recover from the height of the COVID-19 pandemic. The city has a large presence of companies in the tech sector, many of which let their employees start working remotely.
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Data published by the San Francisco Office of Economic Workforce & Development showed that weekly office attendance in San Francisco for the week of September 27 averaged 44%, a level it has been hovering around for some time. The city posted a 26% office space vacancy rate for the quarter ending in March.
The western span of the San Francisco Bay Bridge and San Francisco skyline.
This year, a slew of companies indicated that they would exit locations in San Francisco’s downtown area. Reasons have varied, with some citing changing consumer habits, local business conditions and safety concerns, FOX Business has previously reported.
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The city had an estimated population of roughly 808,400 in 2022, significantly down from 881,500 in 2019, according to the San Francisco Office of Economic Workforce & Development data.
Original article source: San Francisco apartment building facing foreclosure, significant decline in value
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