Investors and lenders likely face more losses after the owner of a Summerlin office building filed for bankruptcy last week.
CBS I LLC filed for Chapter 11 bankruptcy reorganization and listed $19.4 million in both assets and liabilities.
The filing was the latest in a series of office building bankruptcies and loan defaults tied to the recession in the Las Vegas area since 2008.
Because of what turned out to be overbuilding during the boom years, Southern Nevada office building owners are now struggling with a vacancy rate of 25.2 percent, according to Applied Analysis, and in many cases have had to lower rents to remain competitive.
The Summerlin building owner, CBS I, owns a 71,546-square-foot office building in Howard Hughes Plaza at 10100 West Charleston Blvd., just west of Hualapai Way.
The bankruptcy filing came after U.S. Bank, trustee for holders of the $16.4 million mortgage against the property, initiated foreclosure proceedings and filed a lawsuit May 24 in Clark County District Court asking that a receiver be appointed to take control of the building.
“The income from the property is insufficient to satisfy borrower’s obligations to (debt) holder, and borrower is in default of its monetary obligations to (debt) holder,” the lawsuit charged.
It says CBS has failed to make payments on the mortgage since November and that missed payments and interest through March 26 totaled about $831,000.
CBS hasn’t responded to the lawsuit. Its bankruptcy filing will likely at least temporarily block efforts by U.S. Bank to install a receiver and foreclose on the property.
Some of the other loan default situations in the Las Vegas area this year involved:
• Tournament Hills Office LLC, owner of an office building at 1707 Village Center Circle in the Hills Center North business park in Summerlin. With liabilities of $3.74 million, it filed for Chapter 11 bankruptcy reorganization in January, and that case remains open. A recent court filing showed the building, with 12,638 square feet, was 65 percent leased.
• Holders of the $53.5 million mortgage against the UnitedHealthcare office building, 2716 North Tenaya Way in Las Vegas, have initiated foreclosure proceedings to seize the six-story, 204,123-square-foot building. Investors in the building are fighting the foreclosure in Clark County District Court. Health insurance company UnitedHealthcare, the tenant, is not a party in the litigation.
• Flamingo Pointe Partners LLC, owner of a retail and office complex at 9516 W. Flamingo Road at the Las Vegas Beltway, filed for Chapter 11 bankruptcy reorganization in March.
The company listed $13.3 million in assets against $21.6 million in liabilities.
The property has 44,233 square feet of retail space and 24,282 feet of office space. Its bankruptcy case remains open.
• Office complex owner Sansone-Pecos/I-215 II LLC is fighting a foreclosure and a request for appointment of a receiver filed by Wells Fargo Bank, trustee for holders of the company’s $24 million mortgage.
The property at issue is in Henderson at 9005, 9017, 9029, 9041, 9053, 9065, 9077 and 9089 S. Pecos Road, court records show.