Debt Holders Get Stake in Park Place

Crow Winthrop, which owned the landmark Park Place office complex, said Tuesday it has emerged from bankruptcy with a reorganization plan that gives debt holders a controlling stake in the complex.

The 1.8-million-square-foot office complex is now owned by Jamboree LLC. Debt holders own 90% of Jamboree, and Crow Winthrop Operating Partnership, which owned the building before the bankruptcy, has the remaining 10%.

Winthrop Management, an affiliate of the partnership, will remain as managers of the building.

Crow Winthrop’s problems surfaced in April 1996, when the Park Place owner defaulted on a $202-million mortgage payment. In a filing with the Securities and Exchange Commission at the time, Winthrop said it did not have the financial resources to make the payment and could not find lenders that would extend it credit.

Janine R. Padia, vice president of Winthrop Management, said lenders would not refinance the loan because the building’s value had dipped below the $202-million balloon mortgage payment that was due.

To keep the lenders from foreclosing, the parties involved agreed to the reorganization plan.

Engineering giant Fluor Corp. has been the key tenant in the complex but is planning to move to new quarters over the next couple of years.

The increased demand for quality office space in Orange County should ease the effect of Fluor’s departure, Padia said.

So far this year, Winthrop Management has signed lease agreements and lease renewals for more than 345,000 square feet in the building. Four divisions of Prudential Insurance Co. of America, including Prudential Real Estate Affiliates, have recently leased more than 60,000 square feet, Padia said.