2024 Orange County Commercial Foreclosures
Orange County is a great region for commercial real estate investment, with its multitude of suburbs, office complexes, shopping outlets, and tourist districts. However, it’s also a great example of how hard money lenders can face challenges even in places that are considered more affluent.
The team at Total Lender Solutions (TLS) regularly checks in on commercial real estate markets to get ahead of trends and keep lenders informed. We analyzed the commercial foreclosures in Orange County to gain some insights into what you can expect in 2024.
Orange County Commercial Foreclosures By the Numbers
Entering February 2024, Orange County had 53 commercial foreclosures, according to PropertyRadar.com.
- Commercial foreclosures were evenly distributed throughout Orange County. Unlike other parts of California, downtown neighborhoods did not have a significantly higher number of commercial foreclosures.
- A wide variety of properties had entered commercial foreclosure, including hotels, office buildings, shopping outlets, industrial properties, mixed-use properties, and vacant lots.
- With many of the commercial foreclosures, the outstanding loan balance far exceeded the purchase price. This may suggest that some commercial foreclosures were caused by stalled developments / redevelopments.
Commercial Foreclosures in Orange County Suburbs
Orange County has a large number of affluent suburbs that should support a range of businesses. But there were a few significant commercial foreclosures that occurred in these areas.
For example, there’s an office building in Mission Viejo that hosts a variety of financial services companies. Purchased for $15 million in 2007, the property is short about $2 million on its loan.
“Office buildings have faced challenges since COVID-19,” says Randy Newman, founder and CEO of Total Lender Solutions. “Many companies are shifting to remote work, causing vacancies that can impact an office complex. These office buildings may require innovative and flexible management solutions to maintain profitability.”
Commercial Foreclosures in Orange County Tourism
California tourism is earning record profits, but there are a few notable hotels that entered foreclosure in 2024.
There’s a large hotel just minutes away from Disneyland Resort that’s short $145 million on its loan. The hotel opened in 2020 and was designed more for adult travelers than families despite its proximity to Disneyland. For instance, the hotel includes an adult-only rooftop and upscale dining.
Another hotel (situated on Pacific Coast Highway in Dana Point) entered foreclosure over $1 million short. The building was constructed in 1946 and had fallen into disrepair before a remodeling project was approved in late 2020.
“The Anaheim hotel demonstrates how some types of commercial properties have struggled to cope with a decline in business travelers,” says Newman. “The Dana Point hotel exemplifies how difficult it can be to redevelop an older or historic property, even when there are ideal market conditions. High interest rates make commercial developments more challenging.”
When To Start a Commercial Foreclosure in Orange County
If your borrower has stopped making payments on their commercial loan, contact Total Lender Solutions as soon as possible. We handle commercial foreclosures in Orange County and anywhere in California and can guide you through every step of the foreclosure process including:
We can help lenders achieve a best-case resolution in their case.
