Planned Symes building conversion canceled as lender forecloses

Denver Office Conversion Project Falls Through Due to Foreclosure

One of the three downtown Denver office conversions slated to receive public funding has been canceled. Last week, the 8-story Symes building at 820 16th St. faced foreclosure by a lender, halting plans by California-based Harbor Associates to transform it into 116 apartments.

The project had been awarded a $17 million loan by the Denver Downtown Development Authority in July to support the conversion. However, Denver’s chief projects officer, Bill Mosher, clarified that the funds had not been disbursed. “It’s no loss to our project, and we will either seek new partners or shift focus to another project,” he stated.

Joon Choi, an executive at Harbor Associates, declined to provide a comment on the development.

Harbor Associates initially purchased the Symes building for $24.5 million in 2018 through its affiliate, 820 16th Street Property LLC. The property was later transferred to Massandra Harbor George Owner LLC, another Harbor-affiliated entity, in a $17.2 million transaction in June 2022. Thorofare Capital, based in Los Angeles, had lent Harbor $18.6 million in April 2022.

Thorofare proceeded with the foreclosure on the building last Thursday following tensions with Harbor Associates. The dispute between the two parties became public in September when Harbor sued Thorofare over repayment terms. Thorofare, in turn, filed a counter lawsuit in October, and the legal battle is ongoing.

Mosher revealed that the City and DDA board were unaware of Harbor’s lender issues when approving the $17 million loan. He emphasized that Harbor likely believed the matter was resolved. The DDA’s office conversion loans are subject to developers securing additional financing and obtaining building permits, delaying the actual disbursement of funds by up to a year.

There is a possibility that another entity may step in to acquire and convert the Symes building, a prime candidate for downtown conversion projects. Thorofare has not disclosed its intentions for the property.

“It’s regrettable, but not entirely unexpected given the current market conditions,” Mosher commented, referring to challenges faced by office property owners exploring conversion projects. Other downtown office conversion endeavors have encountered obstacles, such as a coworking franchisee refusing to vacate the Petroleum building at 110 16th St. and difficulties renegotiating ground leases at 621 and 633 17th St.