The company that owns a 253,000-square-foot office building in Uptown Dallas has filed for bankruptcy. This means that foreclosure can be avoided, at least temporarily.
dallas uptown tower
Whitestone Uptown Tower LLC, the owner of the 12-story office tower, will sell the property on Dec. 1 ahead of a foreclosure sale scheduled for Dec. 5, according to a filing with the Securities and Exchange Commission. filed for Chapter 11 bankruptcy protection.
The LLC represents ownership interests held by Pillarstone Capital REIT and Whitestone REIT, two Houston-based companies that have been in a months-long dispute, the Dallas Business Journal reported. About.
Pillarstone said in an August SEC filing that it received a default note on a loan for Uptown Tower at 4144 North Central Expressway in Dallas. The loan was originally worth $16.45 million, but as of Nov. 17, the repayment amount was $18.8 million due to $14.4 million in unpaid debt and an additional $6.5 million in default interest, according to the latest SEC filings. became.
Pillarstone's efforts to sell the property to satisfy its loan obligations were “thwarted by Whitestone's refusal to approve the sale,” according to the filing. That left them with little choice but to file for bankruptcy to claim ownership of Uptown Tower.
Houston-based Whitestone REIT, which owns 81.4% of Pillarstone stock and is the guarantor of Uptown Tower's loan, told the Dallas Business Journal that Pillarstone failed to notify Dallas of its bankruptcy.・As stated in Business Journal. According to the DBJ report, Whitestone also alleged that Pillarstone made misleading and inaccurate statements in its public filings and announcements, including that Whitestone interfered with a potential sale of the property.
Whitestone is actively seeking to dissolve its partnership with Pillarstone, and both REITs are embroiled in two legal disputes that remain unresolved.
Whitestone previously said: Bisnow A court order has been issued prohibiting Pillarstone from “turning over the keys to the lender” or otherwise abandoning the property, and lenders filed foreclosure proceedings on Uptown Tower in October. He reiterated this statement at the start.
Bradford Johnson, Pillarstone's CEO, said in an SEC filing that the bankruptcy is a viable solution to Pillarstone's efforts to resolve its dispute with Whitestone. This is a necessary measure in light of the fact that the target was not reached.” As of March 31, the building was 56% leased, according to Pillarstone.
Pillarstone owns approximately 927,000 SF of office and industrial space throughout Houston and Dallas. In an August 2022 SEC filing, it said Uptown Tower was the only property that received a loan from the company.
Whitestone is a retail-focused REIT with more than 50 open-air centers in Phoenix, Chicago, Austin, Dallas-Fort Worth, Houston and San Antonio.
