GCCFC 2007-GG9 - COPT Office Portfolio in Special Servicing

Fitch and Barclays are reporting this loan flipped into Special Servicing due to imminent default. Roughly 2/3rds of the underlying properties are located around Baltimore and have heavy exposure to GSA tenants which were severely impacted by BRAC in that area.

Office Markets in places like Huntsville AL (where a large portion of civilian support positions were relocated due to BRAC) have benefited while areas in the greater DC area have been hurt.

Barclays notes that this could impact the AJ, but also highlights the other three COPT Office Portfolios in CMLT 2008-LS1 ($150mm, Northrop, the third largest tenant amongst the two collateral properties, terminated its lease and plans to leave this year), MSC 2006-HQ8 ($108.5mm), and GSMS 2006-GG6 ($103mm).

Skyline officially goes to Special

As Vornado reported in February they let the Skyline portfolio transfer to special servicing yesterday. They blame the drop in occupancy (74%) on BRAC, which has caused havoc in some submarkets (i.e. for Falls Church VA it has been negative, but in markets such as Huntsville, AL it's been positive). They also noted that another 157k sf could be lost in 2012 and a total of 408k sf could be lost by 2016, all related to BRAC.

h/t crabsofsteel