GSN Roundup: Tricolor Parties Legal Representations, Industrial Package Refis, and Savanna Shopping New NY Offices

Top stories in US CRE News this week:

Asset Backed Alert 11.14.25
Tricolor Parties Lock in Legal Representation

Various parties with ties to Tricolor Auto’s financing facilities have retained legal representation in anticipation of a slew of lawsuits tied to the subprime auto lender’s implosion.

Meanwhile, market participants increasingly are coalescing around the idea that additional oversight of lenders that service their own loans might be necessary to prevent similar scandals in the future. Indeed, the belief is that Tricolor’s in-house servicing practices were key in concealing that the Irving, Texas-based company had pledged the same loans across multiple warehouse facilities and securitization pools.

Among the law firms representing the victims of the alleged scheme is Quinn Emanuel, a leading business-litigation practice. Acting on behalf of a large group of Tricolor’s asset-backed bondholders, the firm has sent notices to the company’s bankruptcy trustee and to replacement servicer Vervent that they should preserve all relevant records — a routine preparation for potential legal action.

A second group of bondholders has retained Davis Polk.

A confidential case overview prepared by bankruptcy-trustee consultant Berkeley Research Group also lists the legal representatives of certain institutions that arranged Tricolor’s securitizations and warehouse facilities. They include JPMorgan Chase, which has retained Hunton Andrews and Simpson Thacher, and Fifth Third Bank, which is working with Frost Brown. And Origin Bank has signed on Katten Muchin.

Wilmington Trust, meanwhile, is working with Alston & Bird. Wilmington served as trustee for each of Tricolor’s nine securitizations and was responsible for flagging defective collateral in another role as loan-verification agent, but never spotted repeated or falsified vehicle identification numbers in the company’s asset pools.

As for Tricolor’s servicing practices, industry participants say the company’s downfall adds to a growing pile of evidence that it might be time to establish a standard in which an outside vendor would oversee any lender that handles its own collections.

They point to the 2018 collapse of Honor Finance as another such instance. In that case, prosecutors said executives at the subprime auto lender took advantage of the company’s in-house servicing model by wrongly representing thousands of delinquent loans as current in securing a $200 million warehouse line from Wells Fargo in 2015.

Honor then bundled many of those loans into a $100 million securitization it completed in 2016. With that issue facing default two years later, Wells rescued it by exercising a call option and purchasing the remaining collateral, with the bank absorbing $62 million of losses in the process.

Two Honor executives later pleaded guilty to separate fraud charges tied to a scheme in which they misappropriated funds to an entity they controlled.

“There should be a requirement,” said William Black, a former Moody’s Ratings managing director who now runs Black Analytics. “There’s been some criticism of the business model, of vertically integrated seller servicing.”

Through its dealership chain, Tricolor originated loans to a mostly Hispanic clientele, including undocumented immigrants. The company closed its doors on Sept. 5 and filed for liquidation on Sept. 10.

Berkeley Research, better known as BRG, said Tricolor’s seven outstanding securitizations have a remaining balance of $945.4 million. Moody’s, S&P and KBRA each has downgraded their ratings on the bonds.

BRG said that Vervent’s first servicer report, for the period ended Oct. 25, will be ready for distribution this month.

The U.S. attorney’s office in New York is investigating Tricolor, as is the SEC.

Commercial Mortgage Alert 11.14.25
Firm Seeks $620M To Refi Industrial Package

Merritt Properties is in talks about obtaining $620 million of debt on a large portfolio of industrial properties near Baltimore and Washington.

The shop is looking for a loan to refinance debt on 6.2 million sq ft. It’s taking quotes via JLL for fixed- or floating-rate debt with a total term of five years.

Baltimore-based Merritt is discussing the financing deal with balance-sheet lenders such as banks as well as with CMBS shops, which probably would package the loan into a single-borrower offering.

The collateral is 58 industrial assets that are more than 96% leased and are relatively diversified. There are 405 tenants overall, with an average tenure of more than 17 years. No single tenant represents more than 3% of the total base rent, and the historical occupancy across the pool, dating back 26 years, is close to 95%. The pitch is that those metrics illustrate the long-term stability of the properties.

Two fully leased complexes in the portfolio are the Beltway Business Community, along Commerce Drive in Halethorpe, Md., and Security Business Park, on Lord Baltimore Drive in Baltimore. Merritt has its headquarters in the latter property.

Merritt owns more than 21 million sq ft in the retail, office and industrial sectors, though the bulk of its holdings are warehouse and distribution assets.

The firm has received several equity contributions over the years from Neuberger Berman affiliate Almanac Realty Investors, which owns a stake in Merritt’s portfolio. Almanac had invested $150 million in Merritt prior to 2018, when it pledged another $400 million to help the company expand its industrial holdings, mostly in the Baltimore-Washington area.

Almanac made that investment via its Almanac Realty Securities 7 vehicle, which closed in 2015 with $1.4 billion of equity commitments. It since has formed two more funds, closing on $2.2 billion, including sidecar vehicles, for the most recent, Almanac Realty Securities 9, which held a final close two years ago.

Merritt is headed by chief executive Scott Dorsey, whose cousin Leroy Merritt founded the company in 1967.

Real Estate Alert 11.18.25
Savanna Shops 3 NY Offices at Major Haircut

Three Midtown Manhattan office buildings bought for $400 million combined in the years just before the pandemic are on the block at an estimated value of nearly half that.

The 558,000 sq ft portfolio encompasses midrises at 19 West 44th Street, 24-28 West 25th Street and 48 West 25th Street that are roughly three-quarters occupied. Bids are expected to come in at roughly $400/sq ft, or just under $225 million. That’s 46% less than the $399.9 million the properties fetched on a combined basis in separate transactions previously.

Eastdil Secured is brokering the sale for Savanna, a local investment manager that purchased the buildings from 2017 to 2019. Bids can be made on any combination of the properties.

The listing is the latest in what seems to be a stabilizing office-sales market. Through the first nine months of 2025, sales of properties worth at least $25 million tallied $6.47 billion, according to Green Street’s Sales Comps Database. That’s up 59% year over year, far outstripping the national increase of 36%.

And, with a strong fourth quarter, total Manhattan office sales could crack $10 billion this year, the first time they would be over that threshold since 2019.

Overall, Savanna has spent $60 million on capital improvements to the buildings, including updated common areas, modernized infrastructure and an expanded inventory of pre-built office suites.

The sales campaign is touting the buildings’ locations. The 302,000 sq ft property at 19 West 44th Street, known as the Berkeley Building, is two blocks east of Times Square and two blocks west of Grand Central Terminal. That submarket is billed as one of the city’s strongest, with its lowest vacancy rate in five years and Class-A asking rents up 5% year over year.

The 18-story, 79%-occupied building, between Fifth and Sixth Avenues, has loft spaces and 12,000 sq ft of retail space. Along 44th Street overall there are six high-end hotels and eight members-only clubs, according to marketing materials. Bryant Park and the New York Public Library are two blocks south.

Savanna bought the building in 2017 for $195 million from Germany-based investor Deka Immobilien. The price, based on 293,000 sq ft then, came to $666/sq ft.

The twin 12-story buildings at 24-28 West 25th Street are between Broadway and Sixth Avenue in the Flatiron District, which used to be referred to as Midtown South. Madison Square Park is less than a block east and the famed Flatiron Building, undergoing a massive residential conversion, is three blocks south.

The offered properties total 135,000 sq ft, including 7,000 sq ft of retail. They are 84% occupied. Built in 1911, the buildings share some full floors, allowing an owner to pitch full-floor spaces from roughly 5,000 to 11,000 sq ft.

Savanna bought the complex for $107.4 million, or $807/sq ft, from Japan-based Unizo Holdings in 2019.

A few buildings west is 48 West 25th Street, whose 125,000 sq ft, also including 7,000 sq ft of retail, is 57% occupied. Savanna bought the 12-story property in late 2018 from the Klapper family for $97.5 million, or $774/sq ft.