The Meadows, an office complex in Rutherford, New Jersey, has seen its value decline by 30 percent over the past decade, dropping from $128 million to $90 million, according to Morningstar Credit. The property entered special servicing in May and foreclosure proceedings have recently begun.
American Landmark Properties, which owns the complex, purchased it for $125.2 million in 2015. At that time, the company secured a $92 million senior loan from LCF and an additional $12 million in mezzanine debt from Harbor Group International. The senior loan reached maturity in September. American Landmark has requested a modification of the loan, as reported by Morningstar.
The office market in northern and central New Jersey continues to struggle following pandemic-related disruptions. Many firms have shifted to hybrid work models and are seeking higher-quality Class A office space instead of older properties.
In 2018, Malo Consulting—the largest tenant at The Meadows—defaulted on its lease. Malo occupied about 12 percent of the building’s leasable area, which led to increased scrutiny from lenders. Revenue at the complex fell sharply during the pandemic, decreasing from $16.6 million when the loan was originated to $11.9 million in 2020. Although there was some recovery afterward, occupancy dropped to 83 percent by 2024 and net operating income declined to $7.2 million from $8.6 million nine years earlier.
Currently, several smaller tenants occupy The Meadows, with none leasing more than 9 percent of available space. The largest is Shiseido’s U.S. division; other notable tenants include United Healthcare Service and Kumon’s headquarters.
The property is located near major attractions such as the Meadowlands Sports Complex—home to NFL teams the Giants and Jets—and the American Dream mall developed by Triple Five Group.
A recent report by Colliers International indicates that vacancy rates for offices in north and central New Jersey have risen since early 2022 and now stand at approximately 25 percent. High availability is expected to persist; however, analysts suggest that 2025 could mark the first year of positive net absorption since 2019.
Yisroel Gluck, principal at American Landmark Properties and sponsor of the loan on The Meadows, did not immediately respond to requests for comment.
