L
enders have asked a Los Angeles Superior Court judge to appoint a receiver to take control of The Atrium in Encino from landlord Jamison Properties. U.S. Bank National Association, as trustee for the COMM 2014-CCRE14 Mortgage Trust loan pool, and special servicer Rialto Capital initiated the proceedings on December 6, nearly a year after Jamison defaulted on its $21.5 million commercial mortgage-backed securities loan tied to the property.

    Jamison's spokesperson stated that while a loan modification is not entirely off the table, it is an expected part of the process as they continue negotiations with Rialto Capital. The current economic conditions have led to a longer negotiating period, but Jamison remains committed to reaching a resolution as soon as possible.

    The 163,170-square-foot office complex was purchased by Jamison in 2002 for $20.8 million and had been renovated just before the acquisition. However, occupancy rates declined significantly over the years, from 85% at the time of refinancing in 2014 to 42% in 2022, resulting in negative cash flow.

    A handful of medical and legal tenants remain on site, including Sinai Medical Lab and law firm Keosian Law. Jamison became delinquent on its debt last December, and Rialto Capital took over special servicing with a remaining balance of $17.4 million. The court filings indicate that Jamison has consented to the appointment of a receiver, as stated in the loan documents and subsequent to default.

    The proposed receivership could pave the way for the property to be sold, but the lenders have not specified any plans beyond requesting the court's approval to appoint a receiver to "take possession of the property and manage and operate it."