PaparazziDallas's Lovin

High-profile office buildings, hotels, land tracts and apartment complexes across North Texas face possible foreclosure next month as tight credit and the soft economy continue to wreak havoc on commercial properties.

The most expensive property posted for the upcoming March foreclosure auction is the Four Seasons Resort & Club in Irving, which is delinquent on a $183 million loan, according to Addison-based Foreclosure Listing Service. Los Angeles-based Bentley Forbes, the owner of the 400-room hotel and 400-acre golf course that hosts the Byron Nelson Golf Tournament, has said the company remains committed to the property and is working with the lender to restructure the loan.

The Four Seasons has been posted for possible forced sale since January, but the lenders have not moved forward with foreclosure. Although the original loan amount on the Four Seasons was $183 million, the property’s current assessed value is less than half that amount, at $85.2 million, according to FLS research.

The Las Colinas resort is the largest of almost 300 commercial properties scheduled for foreclosure March 2 in the Dallas-Fort Worth area, according to FLS.

“We’re seeing a continued trend toward the newer-type properties,” said George Roddy Sr., president of Foreclosure Listing Service. “What we saw a year ago was more Class C and lower-type properties being posted, but for the last six or seven months, we’ve seen that trend changing toward higher-profile properties.”

The second-highest dollar value property was the Mosaic apartments on Akard Street in downtown Dallas. The original loan on that property was $66.5 million, taken out in 2005.

Representatives of Dallas-based Hamilton Properties Corp., the developer of the 440-unit luxury high-rise apartment project, said they remain in discussion with lenders.

Windhaven Park Retail Center at the southwest corner of the Dallas North Tollway and Windhaven Parkway in Plano is also posted for forced sale in the March 2 auction. The original loan amount was $16.8 million on that 87,000-square-foot, 9.2-acre property at 6101 Dallas Parkway.

A 235-acre land tract in northwest Dallas at Interstate 35E and Interstate 635, with an original loan value of $25.9 million, was also posted for foreclosure, as was a 293,000-square-foot office building at 2370 Performance Drive in Richardson, which had an original loan amount of $30 million.

Not all properties posted for foreclosure auction are actually sold by the lender. In some cases, the borrower works out new loan terms, or the sale of the property is delayed by negotiations or bankruptcy.

Commercial property foreclosure filings in North Texas increased more than 25 percent in 2009, rising to 2,431 postings, and the region may top that mark this year, Roddy said.

"We think 2010 is the pivotal year for foreclosures," he said. "We think we'll probably see the worst of it in 2010 and we'll see some tapering off toward the end of the year."

The foreclosures will provide rare opportunities for investors, Roddy added.

"There are a lot of people both inside and outside the state that are actively looking for deals," he said. "By the end of the year, we think there will be a large pent-up demand and some real opportunities for bargain hunting."

So we thought the worst of the recession had passed us... Research has shown that Dallas market was hit later than most other big cities, but what does this mean? Are we just at the beginning? Or are things going to pick-up?
As a local Dallas entrepreneur and business owner (Paparazzi Online Media), it makes me weary of the possible back lash from these foreclosures. Maybe it means smaller commercial real estate property owners will be given a chance to pick up some great properties at a low cost... Good for me. Or maybe it means more unemployment, tighter restrictions on banks and band news for small/ start-up companies needing to increase their revenue.
What are your thoughts? What does this mean for Dallas?