By LYNETTE HAALAND, Four Points News
A trusted real estate source reported that the former 3M campus at 6801 River Place Blvd. may be heading for foreclosure on Oct. 1. This comes a month after the Austin offices of World Class Holding — the owner of the 156-acre former 3M campus — were raided by the Federal Bureau of Investigation.
Journalist Jan Buchholz, an award-winning real estate and business reporter most recently with Austin Business Journal, posted on the ATX Real Estate News website that there was a notice of trustee sale filed on Sept. 9 for the former 3M campus site, which was renamed Silicon Hills Campus LLC.
The Austin real estate firm World Class acquired the 3M campus off of RM 2222, near RM 620, two years ago in June 2017. Within the last week or two, fencing has been put up to prevent people from driving through the campus, which has 11 buildings and near 1.3 million square-feet of office space.
World Class had been leasing the site back to 3M since the acquisition. Some 800 3M employees moved, most over the summer, from the Four Points 3M campus to a new building off Parmer Lane in Northeast Austin.
Last week’s notice of the substitute trustee sale was filed with the Travis County Clerk’s office on Sept. 9, according to Buchholz’s post. The sale is scheduled at the Travis County Courthouse on Oct. 1. That’s the same day an auction is slated for World Class’s retail property near the Austin Convention Center, she added.
Buchholz reported that this default involves a $64 million loan.
“Ladder Capital Finance was the original lender, but the note is now held by Tuebor REIT Sub LLC with an address in Burlington, Vermont, the trustee sale notice shows,” Buchholz reported. “Travis County Clerk records show that Gensler, the architectural firm, filed an affidavit of claim against the property earlier this summer for unpaid fees of $107,468.90.”
Buchholz researched that “professional services furnished by Gensler are described as the preparation of Master Site Planning and Concept Design Studies, according to the document filed on behalf of Gensler.”
“Last summer the State of Texas filed an eminent domain condemnation case involving at least a portion of the property,” records show. But Buchholz reported that based on deeds filed, the state has not yet taken possession of any tracts or parcels associated with Silicon Hills Campus LLC.
This pending foreclosure was put in motion not long after the FBI raided the World Class offices on Aug. 14.
Local media sources, including KXAN and Austin Business Journal, stated that federal investigators visited the offices of Nate Paul’s commercial real estate company at Ninth and Lavaca streets, among other World Class sites.
According to KXAN reports, neighbors said FBI agents were loading up a U-Haul truck with boxes most of the day on Aug. 14 at an Austin home owned by Paul. The FBI did not share details of the raid.
World Class has avoided foreclosures in the past by securing refinancing, according to Buchholz’s reporting.
For the latest in Austin real estate news, go to atxrealestatenews.com
UPDATE from Jan Buchholz on posted on Sept. 20 and since publishing the article in the print edition:
Sources have informed me that a foreclosure sale involving the former 3M Campus, which WCC owns under the name Silicon Hills Campus, has also been canceled, but I see no record of that yet. I’m using the best public database I can access — Travis County Clerk records, but they are by no means posted in real time. Despite the drawbacks of the current system, it’s suppose to reflect real property transactions and associated regulatory activities in a timely fashion.
According to court records (another county website entirely), a hearing was scheduled Tuesday in Travis County District Court after a lawsuit was filed by Tuebor REIT Sub LLC, owner of the $64 million loan that WCC obtained to buy the expansive 3M campus in Northwest Austin last year. That file number is D-1-GN-19-005215. Not sure what that hearing was about, as specific court documents are not provided online to the public. Tuebor’s attorney James H. Billingsley did not respond to an email.