In a stunning turn of events, the Burnett Plaza, an iconic fixture of the Fort Worth skyline and the city’s tallest building, was sold at a foreclosure auction on Tuesday for a mere $12.3 million according to a report from Fox Business.
The sale price represents a staggering 91% discount from the $137.5 million the building fetched just three years ago.
Pinnacle Bank Texas, the lender that held the building’s mortgage, bought back the property with a credit bid of approximately $12.3 million, or just $12.30 per square foot.
The bank had previously claimed in public filings that Burnett Cherry Street LLC, an affiliate of New York-based Opal Holdings LLC and the tower’s former owner, had defaulted on a $13 million loan used to purchase the building in 2021.
The 40-story behemoth, constructed in 1983, boasts over one million square feet of commercial office and retail space, making it not only the tallest but also the largest building in Fort Worth.
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Situated at 801 Cherry St., the distinctive block-sized complex stands at an impressive 567 feet tall and is surrounded by a public urban park. The Tarrant Appraisal District most recently appraised the property at $104.5 million, a far cry from the auction sale price.
BREAKING: BIDENOMICS! The Tallest Building In #FortWorth #Texas, Burnett Plaza, Has Been Sold In A Foreclosure Auction For Just $12.3MILLION Dollars As America's Commercial Real Estate Market Collapses.
This Building Sold For $137.5MILLION Just 3 Years Ago! pic.twitter.com/4KPuk6QhfL— John Basham (@JohnBasham) May 9, 2024
Despite its prime location and impressive stature, the Burnett Plaza has faced its share of challenges in recent years.
According to Cushman & Wakefield, as reported by The Real Deal, the building’s vacancy rate stood at 22 percent last quarter, nearly double the 11.5 percent vacancy rate for Downtown Fort Worth as a whole.
Moreover, the Dallas Business Journal reports that contractors have filed 10 mechanic’s liens totaling more than $1.6 million against Opal, alleging unpaid renovation work at the site.
The largest of these liens, amounting to nearly $1 million, was filed by Tarrant Construction Services for renovations of two suites and the 19th-floor bathrooms.
The foreclosure auction took place against the backdrop of ongoing legal disputes, with Opal suing Pinnacle on April 2, alleging the lender pushed the building into default, according to the Dallas Business Journal.
The Burnett Plaza is home to several high-profile tenants, including General Motors Financial, Kimley-Horn and Associates, Huckabee, and Freese and Nichols.
The building’s future under Pinnacle Bank Texas’s ownership remains to be seen, as does the impact of this sale on the broader Fort Worth commercial real estate market.
In a related development, Pinnacle Bank Texas also bought back a four-building Centerpoint office park in Arlington from Opal Holdings LLC at the same auction for $30 million.
