M
etro Loft Developers is facing another potential default on one of its Financial District office-to-residential conversions. A $265 million senior mortgage for 180 Water Street is set to mature this month, with KBRA downgrading the loan to "underperform". A $100 million mezzanine loan is also due this month, and it's unclear if borrower Nathan Berman will be able to pay off the debt.

    Berman remains optimistic, stating that his firm is working out a solution with both lenders. However, Deutsche Bank, which provided the senior mortgage in 2019, has expressed concerns about the loan's performance. The property, which was converted from an office building to residential units in 2017, boasts high occupancy rates and average rents of $4,800 per month.

    Despite its success, Metro Loft is not immune to financial stress. Over the summer, the company revealed it couldn't repay a $250 million loan backing another project, 20 Broad Street. Talks about modifying the debt have continued since then, potentially leading to an extension or interest rate increase.

    The property at 180 Water Street features amenities such as a courtyard and indoor pool, but its financial situation remains uncertain. Berman's company has been a major player in New York City's office-to-residential conversion market, but even he is facing challenges in managing his debt obligations.