Photo courtesy of Newmark Knight Frank.

New Haven landmark 555 Long Wharf Drive appears to be headed for a forced sale.

A JLL listing for the waterfront property, the city’s biggest class A office block, first reported by the Hartford Business Journal states the brokerage has been retained “on an exclusive basis by the Seller, a regional bank, to arrange the sale of a $31 million non-performing first-mortgage loan.”

The loan, the listing states, was originated in 2010 at $40 million and was most recently on interest-only payments at an 8.5 percent interest rate and reached maturity on March 30, 2023. As of Feb. 2 of this year, the loan was classed as “nonperforming” and had an unpaid balance of $30.99 million.

City land records show People’s United Bank, now part of Buffalo-based M&T Bank, issued a $40 million loan in 2010 backed by the property to an affiliate of 100-year-old New Haven real estate firm The Fusco Corp. The loan had a Jan. 1, 2021 maturity date. However, no documents have been filed with the New Haven city clerk’s office to suggest the loan had been paid back or forgiven.

The 407,320-square-foot office complex was built by Fusco in 1985 and also is home to the company’s headquarters. A separate LoopNet listing for office space at the property includes a June 2023 marketing brochure stated the entire second through seventh floors of the 15-story building were available for lease, minus a pair of office suites on the fifth and sixth floors. In total, the listing noted over 225,000 square feet of availabilities throughout the building.

With a large volume of commercial office loans on its books and under pressure from both regulators and the stock market, M&T Bank is among many lenders opting to force office building owners to sell when they fall into default instead of extending loan terms indefinitely.