California to See Record Number of Hotel Foreclosures Staff
June 26th, 2009

IRVINE, Calif., June 26 – The number of California hotels in default or foreclosed on jumped 125% in the last 60 days. The state now has 31 hotels that have been foreclosed on and 175 in default, according to California-based Atlas Hospitality.
With 19.6% of the total, San Bernardino County leads the state in foreclosed hotels. Riverside County follows with 16.1% and San Diego County has 12.9%. Los Angeles County, with 12% of the total, has the most hotels in default. San Bernardino County is next with 9.7% and San Diego County follows with 8.0%.
Non-franchised hotels account for a disproportionate number of foreclosures. They make up about 87% of the total. However, franchised otels [sic] make up 59% of the defaulted properties.
Initially, the wave of distress in California was seen by the smaller, non-flagged hotels in secondary and tertiary markets. As the hotel conomy [sic] worsened, we have seen it impact all property types. The properties range from the luxurious St. Regis Monarch Beach Resort in Dana Point to the more economical Extended Stay and Red Roof Inn chains.
No market or brand is immune in this downturn. In reviewing the hotels in default or foreclosed on, we found that over 75% of the loans originated from 2005 to 2007. During this period, over 2,500 California hotels either refinanced or obtained new purchase loan financing. Unfortunately, based on today’s market values, we estimate that none of these hotels have any equity remaining. The unprecedented decline in room revenues (California is down 21.5% year-to-date) combined with the jump in cap rates has resulted in a massive loss in values. We estimate that values are currently 50-80% lower than at the market’s peak in 2006-2007.

  Nob Hill Hotel Stanford Court Sold to Los Angeles Investors
Three of the grande dame hotels on San Francisco’s Nob Hill — the Fairmont, Mark Hopkins and the Stanford Court — are now in the hands of Los Angeles real estate investors.

  Casa Laguna Changes Hands
Casa Laguna Inn & Spa, a boutique hotel in Laguna Beach, has sold on undisclosed terms.

  Westin South Coast Plaza Starts $20M Renovation
The Westin South Coast Plaza in Costa Mesa is scheduled to start a $20 million renovation this week, with makeovers for its 393 rooms expected to be finished in April.

  Montage Bets $100M on Boutique Trend
Irvine-based Montage Hotels & Resorts is breaking new ground in more ways than one.

  LB Hotel Fetches $8.2M in Auction
A 66-room hotel in Laguna Beach is set to change hands for $8.2 million after the note securing it was sold via an Internet auction last week.

  Monterey Court Approves Sale of Area Marriott Hotel Group
According to Trigild CEO Bill Hoffman, the properties were held in a family trust and sold for an undisclosed price after Monterrey California Superior Court Judge...

  Receivership Sale Closes on Three Marriotts
SAN DIEGO—San Diego-based real estate services firm Trigild said today that it has completed the receivership sale of three Marriott hotel properties in Thousand Oaks and San Luis Obispo to BRE Atlas Property Owner LLC. The sale came after Trigild overcame legal objections of some of the defendants in the case. The deal also completes the disposition of a five-hotel portfolio.

  Mammoth Mountain Owner Buys Bear Mountain and Snow Summit
The operators of the Mammoth Mountain ski resort, one of the nation's most popular snow destinations, have signed a $38-million deal to acquire the Bear Mountain and Snow Summit resorts near Big Bear Lake in the San Bernardino Mountains.

  Hotel Under Construction in Downtown L.A. Will Be an InterContinental
The enormous new hotel being built in downtown Los Angeles will be an InterContinental, its developers announced Tuesday.

  California Beach Hotel to Get $185 Million Luxury Rebuild
Rick Caruso, a Los Angeles shopping-mall developer, plans to spend about $185 million to rebuild a Southern California seaside hotel with a troubled past into a luxury getaway.

  Here's What Hotel De Anza's New Owner Has in Store for Historic Property
The new owner of downtown San Jose's Hotel De Anza has big plans to modernize the property, built in 1931, in an effort to make it more attractive to today's tech-heavy clientele.

  Best Western Sells to Investors Who See High-Rise Hotel in the Future
Local investors bought a small hotel next to the Sacramento River with the idea that it could become a high-rise property in the next decade.

  Hotel del Coronado Ownership Consolidation Tops Transactions Here
The most expensive hotel transaction in California, during the year's first half, was Strategic Hotels & Resorts' May acquisition of the 63.6 percent interest in the 757-room Hotel del Coronado it did not already own, <b>Atlas Hospitality Group</b> reported.

  SD County Has Priciest Hotel Sale in State
Plenty of hotels changed hands in San Diego County during the first half of this year, but nowhere in Southern California was there any area that matched the surge in sales recorded in the red-hot San Francisco market.

  Survey: Hotel Sale Prices Down in Fresno County
A new survey by Atlas Hospitality Group showed hotel sales increased in Fresno County so far this year but not so much in sale amount.





Additional Comments:











Home   |   About Us   |  Advisory Services   |  Current Listings   |  Press   |  Contact Us

Atlas Hospitality Group is a Real Estate Broker Licensed by the California Department of Real Estate Under License Number 01216856