Finance  ·  Distress

Ares Management and Monument Realty’s DC Office Tower on Brink of Foreclosure

Liberty Building is the latest in a string of defaults and foreclosure notices for offices in the nation’s capital

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Yet another Washington, D.C., office tower may be heading to the auction house soon, the latest in a series of multimillion-dollar assets falling into distress in the District.

This time it’s the 10-story, 176,016-square-foot Liberty Building tower at 1129 20th Street NW. An affiliate of the building’s lender, Principal Financial Services, filed a foreclosure affidavit Monday with the D.C. Recorder of Deeds, according to the Business Journals

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Owners Monument Realty and Ares Management acquired the tower at the end of 2020 for about $85 million. The lender issued a $60.6 million loan toward the building the following year. 

A foreclosure affidavit is typically the first step toward a foreclosure auction, though the building’s fate is not written in stone, as the owners and lender could come to an agreement before that point. The remaining unpaid balance on the loan is unclear. 

A representative for Ares declined to comment, while a representative for Monument did not immediately respond to a request for comment.

Still, the Liberty Building has seen better days. Its offices are nearly 40 percent vacant with nearly 70,000 square feet of space currently available, according to marketing materials from Avison Young

The property isn’t the only D.C. office building in distress at the moment.

Beacon Capital Partners are on the brink of default on a $243 million loan for its Lafayette Centre complex, just a few blocks away from the Liberty Building. The loan, issued by Goldman Sachs, was set to mature in 2027 but was recently transferred to special servicing, according to data sourced from Trepp.

Meanwhile, a 123,000-square-foot office building at 1750 H Street NW, about one block west of the White House, is already headed to foreclosure auction after owners AEW and Office Properties Income Trust defaulted on their mortgage, according to a foreclosure notice posted last month. 

Further, Clarion Partners last month forfeited 701 Eighth Street NW to lender Voya Investment Management in lieu of foreclosure. 

Nick Trombola can be reached at ntrombola@commercialobserver.com.