Hudson Valley Resort & Spa Files Chapter 11
Another hotel has hit our hotels in trouble radar. The Hudson Valley Resort & Spa in Kerhonkson, New York is saddled with $26 million of debt and has declared bankruptcy hoping to avoid foreclosure. The Times Herald-Record reports that the owners of the resort filed Chapter 11 back in January around the same time that their biggest lender finished a foreclosure case against them. Chapter 11 bankruptcy could give the owners time to reorganize and keeps the bank from being saddled with a property it doesn't really want. The 332-room resort remains open.
The current owners purchased the hotel in 2006 for $18.5 million (it is currently valued at $5.8 million) Their plans for the property including making it a Marriott-branded hotel and adding 300 vacation homes to the property. They also contracted golfer Vijay Singh to redesign the resort's 18-hole golf course but none of these plans materialized. The resort is the biggest private employer in this small town with 150 people. The hotel also owes the Town of Rochester nearly $40,000 in taxes. The Times Herald-Record article has a quote from a former owner who went bankrupt on the hotel in 1997 and says the current owners paid too much for it. The amount of debt that the hotel is carrying will make a potential recovery an uphill climb.