All we want for Christmas is some Jingle Mail

Morgan Stanley is turning in the keys to 5 properties that were part of the Blackstone EOP-flip. All are in San Francisco. I'd say these properties are off more than the 50% quoted in the article - they were the peak of CRE market, and they're in San Fran which already has issues that are worse than the average MSA.

My favorite part about the story is this:

“This isn’t a default or foreclosure situation,” Barnes said. “We are going to give them the properties to get out of the loan obligation.”

They're not defaulting - they're just going to give the lender the keys and stop paying the mortgage payments, permanently, which is the opposite of what was agreed to in the loan docs. He sounds like the traffic cop who explained to me that he was giving me a "simple" speeding ticket, not one of those complicated ones.

The buildings Morgan Stanley is giving up are One Post, 201 California St., Foundry Square I, 60 Spear St. and 188 Embarcadero, Barnes said. The bank will continue to own the five other office buildings it acquired in the deal, Barnes said.

Terranea Resort Defaults - Lowe's turns in the keys

The lender was Cascade (which may go unnoticed). It was driven by Corus, which is in the process itself of failing...

Lowe’s default to Kirkland, Washington-based Cascade came after Corus Bankshares Inc. of Chicago, Lowe’s construction lender, failed to supply a final $12.5 million payment to the developer, Diehl said. Corus said this month it may shut down as the bank’s nonperforming loans left it below capital levels required by U.S. regulators.
An $8 million loan to Lowe’s from the city of Rancho Palos Verdes has been delayed pending resolution of the company’s finances, Diehl said.
Corus didn’t fund Lowe’s loan because the Terranea project was “out of balance by millions of dollars” and the loan agreement required Lowe to raise additional equity capital before Corus made more payments, Dwight Frankfather, a Corus senior vice president, wrote in an e-mail. He declined to provide further details.
Calls to Cascade weren’t immediately returned.

A room with a king-size bed and ocean view showed a daily rate of $392 for an Aug. 21 through Aug. 23 stay, according to the Terranea Web site. The hotel is situated on 102 acres on the former site of the Marineland of the Pacific theme park, south of Los Angeles.