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Lehman Bros. bankruptcy jeopardizes $19 million in local tax payments

Monday, November 17, 2008 by Austin Monitor

A number of buildings in Austin owned by the Thomas Properties Group could be in jeopardy because of the massive Lehman Brothers Holdings bankruptcy.  The owners of the 10 high-profile office buildings, including the Frost Bank Tower, might not be able to pay the $19 million owed on a tax bill due in January.


Lehman Brothers has refused to honor a promised $100 million revolving loan to the properties, according to a filing in New York bankruptcy court. TPG-Austin, the partnership that owns the buildings, said in court documents it might have to file for bankruptcy unless Lehman comes up with the money.


Lehman Brothers provided a $192.5 million loan to buy the properties, which sold for $1.1 billion last year. Lehman is a 50-percent owner of the partnership, along with Thomas Properties Group and the California State Employee Retirement System.


 In addition to the Frost Bank Tower at 401 Congress, the properties include:


  • Great Hills Plaza, 9600 Great Hills Trail;
  • Park 22, 8601 Ranch Road 2222;
  • Westech 360, 8911 Capitol of Texas Hwy.;
  • 300 West Sixth St.;
  • One American Center, 600 Congress Ave.;
  • One Congress Plaza, 111 Congress Ave;
  • San Jacinto Center, 98 San Jacinto Blvd.;
  • Research Park Plaza, 12401 Research Blvd.; and
  • Stonebridge Plaza, 9600 N. MoPac Blvd.


TPG-Austin says Lehman refused to honor a Sept. 17 request for the entire revolving loan amount. TPG-Austin said without the loan funds, it could not pay the tax bill on properties in January.

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