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.

  Hip AC Hotel Replaces Hampton Brand in Downtown San Jose
TPG Hospitality intends to break ground next month on a new, 210-room hotel in downtown San Jose — but the property won't be a Hampton Inn, as reported last year.

  RLJ Lodging Doubles OC Presence with Irvine Buy
Bethesda-based hotel operator RLJ Lodging Trust has snapped up a hotel in Irvine, its second local acquisition this year.

  Coastal Comeback
If the foreclosure proceedings faced by the St. Regis Monarch Beach Resort in 2009 was Orange County’s most notorious illustration of the last real estate crash, then May’s low-key sale of the posh resort represents a quiet but clear comeback for the high end of the hospitality industry here.

  Hotel Construction, Remodeling in High Gear
Dirt’s turning at a rapid clip for Orange County’s hotel landscape, and there may be no other local company that reflects that activity more than R.D. Olson Construction.

  New Era Unfolding in Aliso Canyon
The new owner of The Ranch at Laguna Beach figures he’s spent $30,000 in the last year trimming 107 trees on the 84-acre property, including towering eucalyptus “widow makers,” as well as cutting down non-native pines.

  Hotel with Exclusive Indoor Water Park Is Rising Near Disneyland
A big hotel with its own indoor water park is being built near Disneyland as a growing Wisconsin resort operator brings a new tourist attraction to Southern California.

  Virgin Hotels Considers Downtown Mountain View
Virgin Hotels, the hotel brand founded by billionaire entrepreneur Richard Branson, could come to Mountain View.

  Santa Cruz Holiday Inn Express Sold for $16.5 Million
Southern California investors take over hotel built in 2009 by BPR Properties

  L.A. Should Be More Selective with Hotel Tax Breaks, Some Say
With the City Council poised to consider a new crop of downtown hotel subsidies, one high-profile project in particular is being seen as a test case.

  Palm Springs: Own a Piece of the ‘Hard Rock’
Own a piece of “The Rock.” That was the Wednesday morning wake-up call Andre Carpiac, majority owner of Hard Rock Hotel Palm Springs, put out to investors to raise $1.5 million — or more — through a crowdfunding offer by the Beverly Hills-based real estate tech company, RealtyMogul.

  Chinese Fuel California Hotel Deals, Demand
SAN DIEGO—Healthy numbers of Chinese tourists with cash to spend will continue to boost hotel occupancy nationwide, contributing to record prices for prime properties, according to industry experts meeting last week in San Diego.

  Claremont Hotel Bought by Fairmont and Richard Blum Group
BERKELEY -- The landmark Claremont Hotel Club & Spa on the Oakland-Berkeley border has been bought by a group led by the Fairmont Hotel chain and financier Richard Blum, the buyers announced Friday.

  The Hotel Building Rush Is on in O.C. and L.A.
5 new hotel must-haves Technology, lifestyles and changing guest tastes mean hotel builders have to consider a whole new range of amenities at their properties. Here's R.D. Olson founder Bob Olson's guide to five hotel essentials:

  Panelists Discuss U.S. Lodging Industry Forecast; 6% RevPAR Increase Predicted for 2014 & 2015
R.A. Rauch & Associates (RAR) hosted Onward & Upward: A Lodging Industry Forecast for 2014 on Friday, March 14, 2014 at the company's owned and managed Hilton Garden Inn San Diego/Del Mar.

  Investor Interest in California Stays Strong
High levels of demand and generally little new supply are fueling continued interest in hotel acquisitions in California.





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