A fund managed by IGIS Asset Management has reportedly confirmed it has defaulted on the debt linked to the Trianon tower in Germany’s financial capital, paving the way for insolvency proceedings.
The loan had been subject to a standstill agreement while the investors, which part own the building, sought to reach a deal with their lenders, according to press reports. However, IGIS failed to reach an agreement by the May 31 deadline and the creditors have declined to extend the standstill period.
The so-called Trianon fund, which was formed in 2018 to buy the 45-storey skyscraper for €670 mln, is expected to file for bankruptcy within the next three weeks, according to the landlord.
IGIS bought the asset in 2018 together with Hana Financial Investment from NorthStar Realty Europe.
Last year the 68,000 m2 tower saw about an 80% loss in value after Deka Bank, which represented 60% of the building’s tenants, did not extend its lease in 2020 amid the office market downturn. Its moving out also led to a surge in the asset's loan-to-value ratio (LTV) to over 65%.
In July last year, IGIS Asset decided to sell the high-rise building and extended the fund’s expiration date by two years at a meeting with limited partners in October. But it has so far failed to find a buyer for the asset.
