Downtown Hartford’s iconic Goodwin Square office-hotel property has slipped into foreclosure as its owners have failed to make payments since January, state court records show.
Northland Investment Corp. has defaulted on its $33 million loan for Goodwin Square, the 330,901-square-foot property that includes the 30-floor office tower and historic Goodwin Hotel, which shut in December 2008.
As of June 1, 2010, the outstanding principal balance on the loan was $33 million, and Northland owes more than $1 million in interest payments and penalties, court records show.
Additionally, Northland has failed to pay more than $150,000 in real estate taxes on the property, forcing the lender to advance its own funds to cover the debt, records show.
The loan matures in October, papers show.
Goodwin Office LLC is listed as the plaintiff in the case, while Northland Goodwin LLC and Northland Fund II LLC are named as plaintiffs.
Deutsche Banc Mortgage Capital LLC, originally underwrote the loan and then sold it to Wall Street investors.
Northland, which is downtown Hartford’s largest commercial landlord, now has three of its six properties in the city in foreclosure.
Northland did not immediately return a call seeking comment this morning.
The Hartford Business Journal reported in March that Northland had missed several payments on the Goodwin property.
At the time, the company said it was negotiating with its lender “to produce an extension that will give us time to get a new loan and a modification of the interest rate.”
“Like most commercial real estate borrowers, the lack of liquidity is making refinancing at maturity problematic,” the company said in March.
The Goodwin is the third Northland-owned property in Hartford to fall into foreclosure.
Metro Center, the 12-story office building at 350 Church St., received a foreclosure notice last September, after Northland failed to make mortgage payments since April 2009, according to court records.
A few months later, the 18-story downtown Hartford office tower CityPlace II was hit with a foreclosure notice, court records show. According to the foreclosure suit, Northland took out a loan on the property at 185 Asylum St. in 2006, but defaulted on its payment starting June 1, 2009.
Northland provided the same explanation for those foreclosures as it did for the Goodwin Square default.
Northland acquired the landmark Goodwin Square property from the state pension fund in 2005 for $41 million. The agreement provided Northland with the 124-room, five-story Goodwin Hotel and the 30-story Goodwin office tower adjoined by five-story atrium and an eight-level parking garage.
As the economy began to sour in 2008, however, Goodwin Hotel became unprofitable for Northland, forcing the company to shut its doors. Northland cited losses in excess of $6 million on the hotel since the fall of 2005.
The occupancy rate on the Goodwin Square property, whose major tenants include Pepe & Hazard and Halloran & Sage, was 86 percent at the end of September, compared to 99 percent in December 2008, industry data shows.
Northland also owns the 36-story Hartford 21 tower and the The Standard Building, both on Trumbull Street, and The Crosthwaite Building on Allyn Street.
