Suburban Baltimore Corporate Park’s Value Falls 75%
The $29M drop in appraised value over 10 years highlights the challenge facing corporate office spaces
By Jacob Gardenswartz May 15, 2024 2:25 pm
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To understand the ongoing financial hurdles facing the commercial office space sector in a post-pandemic world, one needs look no further than a large corporate park in suburban Baltimore.
In 2013, the 218,000-square-foot Highland Corporate Park at 940 Ridgebrook Road in Sparks Glencoe, Md., about 20 miles north of Downtown Baltimore, was appraised at $38.7 million. But in April, that value was cut over 75 percent to just $9.5 million, according to a recent report from the commercial real estate market research firm Trepp.
As recently as 2023, the $22.1 million loan on the property had posted a debt service coverage ratio of 1.56 with 100 percent occupancy, Trepp reported. Yet, the lease for Element Vehicle Management, the fleet management company that had been the sole tenant of the space, ended in February, and the company has since moved to a different, smaller corporate space closer to Baltimore, according to the address listed on Element’s website.
Representatives for Katewood Deerwood, the entity that owns the property, and Cushman & Wakefield (CWK), the property’s broker, did not immediately respond to inquiries.
According to Trepp, the loan matured in December 2023 but showed a delinquency status of nonperforming matured balloon until April, and now reflects foreclosure status. The loan was then transferred to special servicing when it failed to pay off the balloon by its maturity date. The current status of foreclosure negotiations is unknown.
