Northland Investment Corp. has lost a second major downtown Hartford office building to foreclosure, city records show.
The Massachusetts development company’s Goodwin Square Class A office tower, located on Pearl Street, was taken over by its lender July 25, city records show, after Northland failed to come up with the $33 million in debt it owed on the property.
The foreclosing entity was LNR, a Florida-based special servicing company.
The transfer of ownership follows a prolonged two year court battle over the future of Goodwin Square. A judge ordered the property into strict foreclosure in May, and set a July 24 deadline for Northland to pay off its debt.
A Northland official did not immediately respond to a request for comment. Northland began defaulting on its $33 million mortgage for the 327,979 square-foot office tower in January 2010.
At the time, Northland officials said they were trying to negotiate with their lender to get a new loan and a modification of the interest rate. The loan, however, had been securitized and sold to Wall Street investors, making it difficult to renegotiate the terms of the mortgage.
This represents the second major downtown office tower Northland has lost this year. The company’s Metro Center office tower was lost to foreclosure in January, and their nearby City Place II office tower is in the final stages of foreclosure.
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.
