MPG Office Trust, Inc. (NYSE:MPG), a Southern California-focused real estate investment trust, today consented to the appointment of a receiver to take possession of Two California Plaza. The court appointed receiver will now be responsible for the management and operation of the building. This is a key first step in MPG’s plan to exit Two California Plaza on a cooperative basis with the special servicer. Two California Plaza is currently encumbered by $470.0 million of mortgage debt.
David L. Weinstein, President and Chief Executive Officer, commented: “Two California Plaza is an asset that is significantly overleveraged. While we are disappointed that the Company was unable to retain this asset, we were unable to restructure the loan on terms that were in the best interests of our stockholders. We determined that it was a more prudent use of the Company’s cash to support our remaining portfolio of Downtown Los Angeles assets.”
The appointment of a receiver and the ultimate exit of Two California Plaza will not have any impact on the operation of any of MPG’s other downtown properties. The Company remains optimistic about the prospects for Downtown Los Angeles as a whole and for its core portfolio.
About MPG Office Trust, Inc.MPG Office Trust, Inc. is the largest owner and operator of Class A office properties in the Los Angeles central business district and is primarily focused on owning and operating high-quality office properties in the Southern California market. MPG Office Trust, Inc. is a full-service real estate company with substantial in-house expertise and resources in property management, marketing, leasing, acquisitions, development and financing. For more information on MPG Office Trust, visit our website at www.mpgoffice.com. Business Risks This press release contains forward-looking statements based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. These risks and uncertainties include: risk associated with our ability to extend, refinance or replay our debt as it comes due; risks associated with our ability to dispose of properties, if and when we decide to do so, at prices or terms set by or acceptable to us; risks associated with the timing and consequences of loan defaults and related asset dispositions; risks associated with our liquidity situation; risks associated with our dependence on key personnel whose continued service is not guaranteed; risks associated with the continued or increased negative impact of the current credit crisis and global economic slowdown; general risks affecting the real estate industry (including, without limitation, the inability to enter into or renew leases at favorable rates, dependence on tenants’ financial condition, and aggressive competition from other developers, owners and operators of real estate); risks associated with the availability and terms of financing and the use of debt to fund acquisitions and developments; risks associated with increases in interest rates, volatility in the securities markets and contraction in the credit markets; risks associated with joint ventures; potential liability for uninsured losses and environmental contamination; and risks associated with our potential failure to qualify as a REIT under the Internal Revenue Code of 1986, as amended, and possible adverse changes in tax and environmental laws.