Now that soaring rates have burst the commercial real estate bubble, the carnage is coming fast and furious.
This morning Bloomberg reports that Wall Street’s largest commercial real estate landlord, private equity giant Blackstone, has defaulted on a €531 million ($562 million) bond backed by a portfolio of offices and stores owned by Sponda Oy, a Finnish landlord it acquired in 2018.
While the PE firm had sought an extension from holders of the securitized notes to allow time to dispose of assets and repay the debt, the surge in market volatility triggered by the war in Ukraine and rising interest rates interrupted the sales process and bondholders voted against a further extension, the Bloomberg sources said.
And since the security has now matured and has not been repaid, loan servicer Mount Street has determined that an event of default has occurred, according to a statement Thursday. The loan will now be transferred to a special servicer.
Read full article here: