hotels in trouble

Downtown Nashville's Hotel Indigo Files Chapter 11

Bad news for one of Nashville's two Hotel Indigo properties. The Tennessean is reporting a default on a $17.5 million loan on the property for the Hotel Indigo on Union Street in downtown Nashville, Tennessee. The hotel property's owner, 315 Union Street Holdings LLC., and the owner of the hotel business itself, Union Street Plaza Operations LLC, each filed separate Chapter 11 petitions in U.S. Bankruptcy Court in Nashville last week. They listed total combined debts of about $25.6 million against assets of about $14.1 million, which takes into account the $13.1 million value of the real estate. The article states that Branch Banking & Trust of Atlanta holds the $17.5 million loan and seeks to foreclose on the property.

Mark Lineberry, the president and majority stockholder of the two companies, said that the Chapter 11 filing was an effort to hold off foreclosure and work toward a possible restructuring. As is usual in these types of cases, the hotel remains open for business. Lineberry told the Tennessean that the hotel is doing well and making money. The other local Hotel Indigo, on West End Avenue, is not affected.

The Hotel Indigo on Union Street opened last fall in two historic buildings, 301 Union and 315 Union, which were combined. The 301 Union structure, built in 1909, was originally the American Trust Building; the other, built in 1926, was the Nashville Trust Co.

Tags: chapter 11, hotel indigo, hotels in trouble, nashville

Solage Calistoga Defaults On Loan

by Deidre Woollard (RSS feed) —

Filed under: Luxury Travel & Hotels

Trouble in Napa Valley. The Napa Valley Register reports that the owners of the luxurious Solage Calistoga in Calistoga, California has defaulted on a $47.2 million loan on the property. The resort, which opened in 2007, has 89 rooms and suites and has an eco-friendly slant that includes bicycles, earth-friendly interiors, environmentally safe cleaning products, locally-sourced food, sustainable landscaping, recycling and water reclamation. The resort has a bistro, full-service spa that includes Kate Somerville facials and a 130-foot swimming pool surrounded by cabanas. The restaurant, Solbar, is headed by Brandon Sharp, an alumnus of the hot Gary Danko restaurant in San Francisco.

Solage Calistoga General Manager Richard Hill has said that the default occurred as part of a loan renegotiation process and the property will not proceed to a Trustee Sale. It remains open for business as usual. Rates at the luxury resort start around $325 per night.

Tags: calistoga, hotels in trouble, napa valley, napa valley resort, solage calistoga

W Hotel in Atlanta Heads Back To The Lender

by Deidre Woollard (RSS feed) —

Filed under: Luxury Travel & Hotels

The W Atlanta-Downtown hotel and condos project went back to its lender this week. The Atlanta Journal-Constitution reported that the hotel tower, which was developed by Barry Real Estate Cos. was foreclosed upon by the senior lender, a joint venture between the FDIC and Square Mile Capital Management. Barry Real Estate had ceded its ownership stake to Capri Capital Partners, the hotel's mezzanine lender, in order to avoid foreclosure. The original lead lender, Silverton Bank, had failed in May 2009 and was taken over by the FDIC. In May, the FDIC auctioned the servicing rights to the loan to Square Mile and so both are part of the latest move. The hotel, which opened last year is doing brisk business. The hotel's general manager reports that several conventions have filled the hotel to capacity for 12 nights in October. This month the hotel is offering a Breast Cancer Awareness month package that includes 2 ThinksPink cocktail, free valet parking and a $10 donation to the Young Survival Coalition with rates starting at $219.

Other W hotels have had similar problems. The W Boston has been fighting foreclosure for months. The W Union Square in New York City was in foreclosure for months but was recently purchased. The W San Diego was foreclosed on over the summer and is now owned by its lender.

Tags: atlanta, hotel foreclosure, hotels in trouble, w hotel

Ritz-Carlton Kapalua Facing Foreclosure

by Deidre Woollard (RSS feed) —

Filed under: Luxury Travel & Hotels

Another Hawaiian hotel is facing foreclosure. The Wall Street Journal reports that the estate of the bankrupt securities firm Lehman Brothers Holdings Inc. is foreclosing on the luxurious Ritz-Carlton Kapalua resort in Kapalua, Maui. The 463-room resort completed an extensive $180 million transformation including the lavish Ritz-Carlton Spa, Kapalua, Maui with 15 treatment rooms. The resort has been owned since 2006 by a venture of Gencom Group and Goldman Sachs Group Inc.'s Whitehall Street Global Real Estate LP. The group has been in default on the $255 million mortgage and negotiations have been in progress for several months. Part of the issues was that the group planned to sell 107 condominiums to cover the cost of the renovations. When real estate came tumbling down they were able to sell less than a third of those condos and were unable to pay back the loan when it came due.

As the WSJ article points out, foreclosures and loan issues are becoming common for Hawaii hotels. Big resorts including the Four Seasons Maui, the 540-room Fairmont Orchid Hawaii and the 203-room Ilikai Hotel in Honolulu have all faced trouble. As is usually the case in these situations, the Ritz-Carlton Kapalua resort remains open for business. A bed and breakfast hotel package at the hotel starts at $349 per night.

Tags: hotels in trouble, ritz-carlton, Ritz-Carlton Kapalua

Siena Hotel Casino In Reno Files Chapter 11

by Deidre Woollard (RSS feed) —

Filed under: Luxury Travel & Hotels

No luck in Reno as the Siena Hotel Casino has filed for Chapter 11 bankruptcy. The hotel made the move so that it can stay open and reorganize its debt. The Siena has been months behind on paying its gaming taxes and was at risk of losing its gaming license. It has also been behind on other state taxes and fees. Casino's employees were also dropped from their health coverage because the Siena didn't pay its bills and it owes $400,000 to NV Energy.

Siena owner Barney Ng has invested about $100 million into the Siena since 2000 in both loans and his own capital and has a $50 million loan. In December the hotel and casino property had received a notice of default and threat of foreclosure from its lender and last month the casino closed its table games. The property has a 214-room hotel and employs around 300 people (down from 500 at its peak). It remains open.

Tags: bankruptcy, chapter 11, hotels in trouble, reno, siena hotel

Ireland's Largest Hotel In Receivership

by Deidre Woollard (RSS feed) —

The Citywest Hotel in Dublin, Ireland is the latest hotel to hit hard times. The four-star Citywest development has been placed into receivership by Bank of Scotland (Ireland). The property has over 1,700 rooms, two golf courses, a separate convention center and a helipad and the hotel website lists it as Ireland's largest hotel.

Ferris Associates has been appointed as receiver to HSS, which trades as the Citywest Hotel, Conference Centre, Leisure and Golf Resort and Jeffel, a land-holding company. The company owes the Bank of Scotland 180 million euros. Ferris associates has appointed Dalata Ltd, a hotel operating company, to run the hotel and Citywest's 400 staff will continue to be employed. The Citywest Hotel was founded by well-known and often controversial local businessman Jim Mansfield 18 years ago. His other properties including Palmerstown Golf Club, Finnstown Hotel and Weston Airport are not affected by the receivership. An executive for the hotel has called the move premature, saying the hotel is currently in talks for a buyout.

Tags: citywest, dublin, hotels in trouble, ireland, receivership

Luxury San Diego Hotel Files Chapter 11

by Deidre Woollard (RSS feed) —

Filed under: Luxury Travel & Hotels

The Sè San Diego has become the latest luxury hotel to file Chapter 11. The San Diego Union-Tribune reports that 5th Avenue Partners, the owners and operators of the 184-room boutique hotel, filed Chapter 11 to prevent the main lender WestLB AG Bank from appointing a receiver to take over. As of last month, Fifth Avenue Partners owed around $73 million. The hotel's construction loan came due in May 2009 just five months after it opened in late 2008. In 2008 we covered the opening of the hotel and the creation of the West Coast's largest hotel penthouse, a three-floor spread going for $20,000 a night.

It also has 22 unsold condos, the Se Residences, that sit atop the hotel. The hotel has struggled to find its place in San Diego's tourist market but does have a thriving nightclub, Siren, a rooftop pool bar & lounge that is popular with both locals and vacationers. The hotel has received good reviews and was on Condé Nast Traveler's 2009 Hot List. The Union-Tribune reports that in the filing Fifth Avenue said it would make almost $4.7 million over the next 13 weeks with total expenses of around $4.4 million. There are signs that a turnaround in both the hotel-condo and luxury travel markets is coming but the question is whether or not the property can manage its finances well enough to hold on until then.

The hotel remains open for business and is offering a Summer Lovin' package that includes accommodation, a summer facial in Sè Spa, Sè Spa Pedicure featuring OPI Summer Collection Polish, daily breakfast for two ($50 daily credit) and valet parking starting at $429 plus tax.

Tags: chapter 11, chapter 11 bankruptcy, hotels in trouble, se san diego

W Boston Hotel and Residences Facing Foreclosure

by Deidre Woollard (RSS feed) —

Filed under: Luxury Travel & Hotels, Real Estate Developments

Another hotel is in trouble. The developer behind the 28-story W Boston Hotel and Residences in downtown Boston has filed for bankruptcy protection. The Boston Globe reports that documents filed in US Bankruptcy Court in Boston by SW Boston Hotel Venture LLC, a subsidiary of Sawyer Enterprises, show liabilities of $100 million to $500 million. The City of Boston itself gave the developer a $10.5 million loan a few months back to help it finish building the $234 million project. The complex opened in October, not exactly a perfect time in the struggling condo real estate market. Only around 10 percent of the building's 122 condominiums have been sold. The Globe reports that W units have sold for as much as $1.9 million for a three-bedroom and $345,000 for a studio.

The W Hotel has 235 hotel rooms on its first 15 floors with rooms that cost more than $300 a night. Hote occupancy rates are still down in Boston because of diminshed tourism. As is usually the case in these situations, the hotel operations are not affected by the filing.

Tags: boston, hotel foreclosure, hotel foreclosures, hotels in trouble, w hotel boston

W Union Square Saved From Second Foreclosure Sale

by Deidre Woollard (RSS feed) —

Filed under: Real Estate Developments

A few months ago Dubai-based Istithmar lost control of the W New York Union Square hotel during a foreclosure auction. One of the property's lenders LEM Mezzanine was named the winning bidder for just $2 million but taking on $212 million in debt. Now the entity formed by LEM Mezzanine, Hotels Union Square Mezz 1 LLC, has filed for bankruptcy to avoid a second foreclosure auction.

DekaBank Deutsche Girozentrale, which held a $60 million loan on the property, was planning to foreclose on the property on Wednesday. Crains reports that Hotels Union Square Mezz 1 reported debts of between $100 million and $501 million. A spokesperson for LEM said that the company is still working on restructuring the hotel's debt. The 20-story hotel, which opened in 2000 was bought by Istithmar in 2006 for $285 million.The hotel remains open for business and is currently offering a special of rates from $289 per night for arrivals Thursday - Saturday.

Tags: hotel foreclosure, hotel foreclosures, hotels in trouble, istithmar, Istithmar World, new york, union square, w hotel

Sawgrass Marriott Files Chapter 11

by Deidre Woollard (RSS feed) —

Filed under: Luxury Travel & Hotels

Last month the Sawgrass Marriott Golf Resort & Spa was in the news as the setting for TIger Woods' mea culpa moment. This month the setting for the Woods' apology is in the news for a different reason, bankruptcy. RQB Resort LP filed for Chapter 11 bankruptcy protection listing estimated assets and liabilities of up to $500 million. A debt of over $193 million is owed to Goldman Sachs which has not been paid since August 2009.

The 65-acre resort has more than 500 rooms and has seen a drop in corporate and group bookings over the last year as a result of the struggling economy. The resort overlooks the Pete Dye-designed TPC Sawgrass Stadium Course famous for the 17th hole which has an island green. The course is the setting for the Players Championship each May. Sawgrass Marriott has the rights to the bulk of the tee times available on the popular course which draws many golfers each year. The hotel is continuing normal operations and hopes to emerge from bankruptcy to take advantage of the hoped-for economic resurgence in 2011.

Tags: hotels in trouble, HotelsInTrouble, marriott, sawgrass, tiger woods, Tiger Woods apology, TigerWoods, TigerWoodsApology

Hudson Valley Resort & Spa Files Chapter 11

by Deidre Woollard (RSS feed) —

Filed under: Luxury Travel & Hotels

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.

Tags: hotel foreclosure, hotel foreclosures, HotelForeclosure, HotelForeclosures, hotels in trouble, HotelsInTrouble, hudson valley resort and spa, HudsonValleyResortAndSpa

Anguilla Resort Heads Into Receivership

by Deidre Woollard (RSS feed) —

Filed under: Real Estate Developments

More resort woes in the Caribbean. The Wall Street Journal reports that Credit Suisse, which represents investors in the Temenos resort on Anguilla, has taken over the project and appointed a receiver to manage it. The resort, which was supposed to have a 32-room hotel and 78 villas offered for sale in the millions, carried a $180 million mortgage. The luxury development was the brainchild of entertainment mogul Robert F.X. Sillerman, who began planning the resort in 2002 and put $180 million of his own money into the project in addition to the monster mortgage. Construction was stopped in 2008 and it is said that the project will need another $125 million for completion. The receiver will be charged with finding a deep-pocketed savior for the project to either finish the resort or take over completely.

Sillerman has had a long career in the entertainment world. In the late 1970s he and a partner created a company that bought up radio and television stations. He used cash from that first venture to build SFX Entertainment into a huge promoter of live entertainment. That company was later sold to Clear Channel for $4.4 billion in 2000. His latest company is CKX, Inc., which we recently wrote about in December. The company bought controlling interest of Elvis Presley Enterprises in 2004 including Graceland and has been working on a major redevelopment project for the 100 acres surrounding the Tennessee home. CKX is also the parent company for Simon Fuller's 19 Entertainment which owns the "American Idol" and "So You Think You Can Dance?" franchises.

Like the Four Seasons Barbados project I mentioned last month, this one also had its share of celebrity investors and other well-heeled buyers, some of who paid deposits of up to 40 percent on idyllic vacation homes. Buyers include bestselling author Dan Brown and television producer Simon Fuller.

Source

Tags: Anguilla, caribbean, foreclosure, hotels in trouble, HotelsInTrouble, receivership, resorts in trouble, ResortsInTrouble, temenos

Whistler Blackcomb Facing Foreclosure Auction

by Deidre Woollard (RSS feed) —

Filed under: Real Estate Developments

Next month's Winter Olympics have been anticipated for years in Whistler. But one resort is facing an unexpected snag, foreclosure. Whistler Blackcomb, which will be hosting part of next month's games may end up being auctioned off in the middle of the Olympics. The owner, private equity firm and hedge fund Fortress Investment Group, has failed to make payments on a $1.7 billion loan. The company bought resort operator Intrawest for $2.8 billion in 2006 back when everything was smooth sailing in the real estate world.

Flash forward to now and Fortress is trying to refinance the loan and lenders to Fortress have been publishing notices of foreclosure in places like the Wall Street Journal announcing a public auction of the assets of Intrawest which includes a bunch of winter resorts sprinkled across North America. The auction date of February 19 puts the sale of Whistler Blackcomb smack dab in the middle of the Olympics. Intrawest is said to be negotiating with the lenders but plans to continue with business as usual and the auction likely won't affect the running of the event. Intrawest properties also include the Whistler Sliding Centre, shown at right, which is the site of the Olympic bobsled and luge events.

The Globe and Mail reports that Intrawest ULC has sold its Panorama Mountain Village resort as part of its effort to stave off the auction. Panorama is located in eastern British Columbia and neither the buyer nor the price have been revealed. Intrawest already sold Copper Mountain in Colorado last November.

Tags: foreclosure, fortress, hotel foreclosure, HotelForeclosure, hotels in trouble, HotelsInTrouble, intrawest, OlympicGames, olympics, whistler, whistler blackcomb, WhistlerBlackcomb, winter olympics, WinterOlympics

Four Seasons Dallas Headed For Foreclosure?

by Deidre Woollard (RSS feed) —

Filed under: Luxury Travel & Hotels

Breaking info from the Dallas Morning News, it looks like lenders are looking to foreclosure on the Four Seasons Resort and Club Dallas at Las Colinas, a massive 400-acre hotel, spa and golf club in Irving, Texas. The five-star resort has an over 430-room hotel, two restaurants, lounge bars, a TPC golf course and the finest sports club and spa in the Dallas area. Last summer the resort completed a $60 million project with a new sports bar, family pool, and tennis show-court.

U.S. Bank NA is has pushed for a foreclosure sale on February 2 to force repayment of a $183 million loan on the property. It's a huge foreclosure for the area and one that has been in the works for a while as the borrowers, BentleyForbes missed payments and tried to negotiate with lenders. BentleyForbes has owned the resort since 2006 and Four Seasons operates the facility. As is usually true in these cases there has been no alteration in the daily operations of the hotel. The resort is the latest in a series of hotel foreclosures around the nation.

Tags: dallas texas, DallasTexas, four seasons dallas, FourSeasonsDallas, hotel foreclosure, hotel foreclosures, HotelForeclosure, HotelForeclosures, hotels in trouble, HotelsInTrouble

Another O'Hare Hotel In Trouble

by Deidre Woollard (RSS feed) —

Filed under: Luxury Travel & Hotels

It seem to be tough going for hotels around Chicago O'Hare airport. Last August we reported on the troubles that have befallen the InterContinental Chicago O'Hare and the Westin O'Hare and now another hotel, the Four Points by Sheraton Chicago O'Hare Airport joins them in financial woes. Chicago Business reports that the Investcorp International , the owner of the 295-room hotel missed the $110,813 December payment on a $22.5-million loan. Investcorp paid $27.4 million for the hotel in 2006 then put another $6 million into the property. It's questionable if the hotel is even worth the loan amount at this point given the changes in real estate in the last couple of years.

Another hotel in the area, the 467-room Wyndham O'Hare closed at the end of last year. The O'Hare market has been hit especially hard. The Chicago Business article references a survey from Smith Travel Research that has revenue per available room at airport hotels falling by more than 30 percent in the bulk of 2009.

Tags: chicago, hotel debt, HotelDebt, hotels in trouble, HotelsInTrouble, ohare airport, OhareAirport, sheraton, sheraton hotels, SheratonHotels