|
|
California to See Record Number of Hotel Foreclosures
HotelNewsNow.com Staff
HotelNewsNow.com
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.
 |
| |
| |
|
|
|
 Developers Plan More Than 650 Hotel Rooms for San Jose
Hotel developers, emboldened by a surge in revenue in the lodging market in Silicon Valley, want to add more than 650 rooms in San Jose, with Aloft, Hampton Inn and Marriott among the brands coming into the Bay Area's largest city.
Irvine Hotel Firm Goes Upscale
Tim Busch had never been to the Bacara Resort & Spa near Santa Barbara, but he knew it was exactly the kind of hotel property for his Irvine-based Pacific Hospitality Group's expansion.
Naming Names
After years of delays, the developers of a luxury condo near Beverly Hills are finally readying for construction. But before the $300 million development can get under way, it faces yet another hurdle thrown up by the hotel across the street.
Room Service
Avi Brosh was hit hard by the recession.
The developer of hip boutique hotels lost millions of dollars – and took a knock to his pride – when a bank foreclosed on one of his marquee projects in 2010. A rival scooped it up for a fraction of the cost.
Posh Downtown SD Andaz Hotel Sells for $53M
DOWNTOWN SAN DIEGO — The Andaz hotel, which opened in downtown San Diego just months before the nation slid into a recession, has been sold to an Illinois real estate group for $53 million.
San Diego Rises as a Diverse Market
REPORT FROM THE U.S.—The San Diego hotel market used to be dependent on its military and leisure demand, but the market has become more diversified in recent years, specifically in the meetings and conventions arena, according to sources.
Downtown SD Hotel Sells for $112.5M
The 337-room Embassy Suites San Diego Bay hotel, which last changed hands in 2006, has been sold to a Maryland-based real estate investment trust for $112.5 million.
Are Tax Dollars Still Needed for Anaheim GardenWalk Hotels?
Two planned four-star hotels near Anaheim’s GardenWalk mall could be built without taxpayer subsidies in one to two years, according to hotel financing experts, calling into question subsidy supporters’ central argument that the hotels can’t be built without the controversial incentives.
Investors Selling Aliso Creek Inn
Local resident and sports retailer Mark Christy is believed to lead in investor group buying Laguna Beach’s Aliso Creek Inn and Golf Course from its current owner, private investors that deep-sixed an ambitious plan to remake the flood-prone property into a high-end conference center and spa fringed by tee-close homes amid the recession in 2009.
|
|
|
|
|
|
|
|
|
|
|
|
|