News Column

South Court building has new owner after foreclosure

July 6, 2014

By Laura Oleniacz, The Herald-Sun, Durham, N.C.



July 06--DURHAM -- Following a foreclosure on the six-story South Court building, the property sold in April to a New York investment management firm for $12.8 million.

A lender to the previous owner moved to foreclose on the property in November after the owner defaulted on a $14.55 million loan, according to Durham County property records.

The loan was originally made in 2003 by Column Financial Inc., a company of Credit Suisse.

A limited liability company connected to New York-based Torchlight Investors bought the building in April.

"In general, we do really like the (metro area), and feel strongly about the property," said Jennifer Yuen, a spokeswoman for Torchlight. "There are strong demand characteristics around the property that fully support this investment, and we think it will perform."

The foreclosure and sale did not appear to affect building tenants like G2B and Doolin's Irish Pub and CafÉ. Andrew Christenbury, general manager for G2B, said the new building managers have been "very helpful" to the restaurant, which is planning to renovate to open a new, small brewery inside its space.

They were "awesome and very helpful and on board with us from the beginning," he said.

The building has housed a series of restaurants in a back-facing ground floor space where G2B now operates. Restaurants that have come and gone there include Starlu, Restaurant Eden and A Seasoned Ticket, a restaurant co-owned by a son-in-law of Mike Krzykewski. That restaurant closed in 2001.

Doolin's Irish Pub and CafÉ opened at South Court in March 2012, and there's also a fitness studio located at the building.

Built in 1998, South Court was in the planning stages when the South Square Mall area was expanding.

The Durham City Council approved a rezoning for the property in 1997.

Retail and office space vacancy rates were lower in southern Durham than in the Triangle at that time. That was before The Streets at Southpoint mall opened in 2002.

According to a the market research firm Karnes, about 40 percent of the 146,000 square-foot South Court building was vacant as of July 1. That included office as well as retail vacancies.

Office space in the South Durham market, which includes the Southpoint mall area, was 19 percent vacant for the in the first quarter, according to Karnes. Retail space in the South Durham market was 4.6 percent vacant in the quarter.

The building is being marketed and managed by the firm Lincoln Harris. According to a news release from the firm, the building also houses offices for Wells Fargo, Merrill Lynch and Neurocog Trials.

"This is an outstanding property, and combining the appeal of this asset with our team's experience and expertise will ensure that we deliver outstanding value and returns to our landlord client," Richie Faulkenberry, senior vice president at Lincoln Harris, said in a statement.

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(c)2014 The Herald-Sun (Durham, N.C.)

Visit The Herald-Sun (Durham, N.C.) at www.heraldsun.com

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Source: Herald-Sun (Durham, NC)


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