The Mortgage Bankers Association sold its Washington D.C. Headquarters at a multi-million dollar loss to commercial real estate firm CoStar Group, according to the WSJ.
The bankers group apparently parted with the property for $41.3 million, well below the reported $79 million paid back in 2007, while it was still under construction.
The sprawling 170,000-square foot, 10-story building at 1331 L St. NW was completed in the summer of 2008, and put up for sale just over a year later.
At the time, MBA chief John Courson warned it was dealing with a “challenging leasing environment,” adding that continued ownership of the building would be “imprudent” and hinder its services over the long term.
The MBA’s membership has dwindled in recent years as a result of the mortgage crisis, falling from roughly 3,000 to about 2,400 members.
At the same time, the MBA has laid off about 30 percent of staff.
When the MBA first secured the property valued at $100 million, it was required to come in with a larger-than-expected down payment and a less favorable mortgage rate because of the timing of the deal.
So much for it’s always a good time to buy…
CoStar said it was able to take advantage of what it saw “as a historic opportunity to secure an exceptional asset at a greatly reduced price.”
Mortgage Bankers Association Cuts 16 Percent of Staff
The embattled Mortgage Bankers Association had earlier cut another 20 full-time staff positions, according to National Mortgage News.
The layoffs affected roughly 16 percent of its workforce, which has now been reduced by some 30 percent since last year thanks to ongoing contraction in the mortgage industry.
The latest cuts included four of its vice presidents, bringing the association’s workforce down to about 110 employees.
Interestingly, the layoffs have been tied to the group’s purchase of a sprawling 160,000-square foot workspace in Washington D.C. back in April.
The commercial space, valued at about $100 million, required a larger-than-expected down payment and came with an unfavorable interest rate because of the timing of the deal.
At the time of purchase, two-thirds of the building was expected to be rented to someone other than the MBA, but poor demand seems to be resulting in staff reductions instead.
The MBA has been around since 1914, advocating on behalf of its members and providing industry research and forecasts such as its widely-watched mortgage application index.
Among other things, the MBA has strongly opposed the so-called bankruptcy cramdown, which it believes would raise mortgage rates substantially, while doing little to help at-risk homeowners.
Currently, about 2,400 companies are members of the Mortgage Bankers Association, though membership has steadily fallen since the mortgage crisis got underway.
Oh by the way, the MBA is running a special right now; join now and get 50 percent off your membership dues…