Fiserv Office Loan Moves To Special Servicing With Lease Expiration Looming

A loan on a fintech giant’s Atlanta-area office complex has moved to special servicing with less than a year until the company’s lease expires.

A more than $56M loan attached to 2900 Westside Parkway in Alpharetta was put in special servicing after its borrower missed its August maturity date, Morningstar Analytics reported. Fiserv’s lease for the entire two-building, 376K SF Alpharetta office complex is set to expire in August 2027.

“Even though the property is performing well, Fiserv’s lease expiration in 2027 makes a takeout loan a non-starter,” Morningstar Associate Managing Director David Putro said in an email.

“We’re seeing this recurring pretty regularly on performing office loans,” he said. “Any sort of tenant risk poses a significant hurdle to refinancing.”

Putro said he did not believe the firm would move from its Alpharetta campus.

“I ultimately expect a short-term loan extension so the borrower can get the lease wrapped up and then work through a refinancing with more certain lease terms in place,” he said. 

New York-based LCN Capital Partners bought the Fiserv campus in 2016 from M&J Wilkow Ltd. for $93M, the Atlanta Business Chronicle previously reported. Two years before that sale, Wisconsin-based Fiserv relocated its Atlanta operations from Peachtree Corners to Alpharetta and into the 2900 and 2950 Westside buildings, according to the ABC.

LCN invests primarily in build-to-suit and sale-leaseback commercial real estate, with more than $7B in assets under management, according to its website. Spokespeople for Fiserv and LCN didn’t respond to requests for comment in time for publication.

According to Morningstar, Fiserv’s loan faces “short single-tenant lease terms” that will likely lead to modifications rather than payoffs.

Miami-based Rialto Capital Advisors took control of the loan on Aug. 12 “to determine the best course of action,” according to Morningstar. Rialto Managing Director Niral Shah, who is named in the Morningstar report, did not respond to a request for comment.

Fiserv, which posted net income of $630M on revenues of more than $5B in the quarter ending June 30, told analysts earlier this month that the company was considering selling one of its debt networks as part of a restructuring strategy, Payments Dive reported.

Facing an influx of competition as well as struggles to deliver on growth prospects, Fiserv CEO Takis Georgakopoulos, who became chief executive this summer, told analysts during a May investor day that he intended to follow the restructuring laid out by former CEO Mike Lyons, according to Payments Dive.