MPG Office Trust Inc. (MPG), a real estate investment trust (REIT), has recently eliminated a $26.4 million construction loan obligation collateralized by 17885 Von Karman, a high-quality office building in Irvine, California.
MPG Office Trust contributed approximately $2.0 million in reduction of the loan which was scheduled to mature on Jun 30, 2010, and turned the property over to the lender pursuant to a deed-in-lieu transaction. Consequently, the company was relieved of the $26.4 million loan obligation and a $6.7 million repayment guaranty.
The debt repayment was part of the continued efforts by MPG Office Trust to improve its liquidity. The company’s debt burden stemmed primarily from its acquisition binge. In 2007, the company bought $2.875 billion of assets at the peak of the real estate bubble. The acquisition put MPG Office Trust heavily in debt, and it is now trying to offload properties to reduce debt.
MPG Office Trust was previously known as Maguire Properties, Inc. The company had changed its name in an apparent move to distance itself from its founder and former chief executive Robert Maguire.
MPG Office Trust is the largest owner and operator of Class A office properties in the Los Angeles central business district. The company specializes in the management, marketing, leasing, acquiring, developing, and financing of high-quality office properties, primarily in the Southern California market.
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