Atlas in the news
Interest Grows in Converting Hotels to Other Uses
Multifamily, Senior Living, Student Housing Among More Popular Conversions https://www.costar.com/article/577844466?utm_source=newsletter&utm_medium=email&utm_campaign=hospitality_prospect&utm_content=p1 By Bryan Wroten Hotel News Now Mar 24, 2021 | 1:09 P.M. Both private and government buyers are finding real estate conversion opportunities with U.S. hotel owners who are reevaluating the highest and best use of their properties due to the COVID-19 pandemic. Buyers and other investors have for years looked to older hotels as a way to have a ready-built property suited for a multitude of needs: condos, affordable housing, student housing and assisted living. Some have found success in converting hotels to other real estate classes, but interest in redeveloping hotels to other uses has grown over the course of the pandemic due to the financial strain it has caused hotel owners. Converting to Other Classes Hotel owners reconsidering their properties’ highest and best use or buyers looking to redevelop a hotel take into consideration three questions, said Josh Smith, senior vice president at Hospitality Real Estate Counselors. First, they have to determine whether converting to another real estate class makes sense financially and whether the cost is feasible. Next, they have to figure out if changing from one use to another is legal. And lastly, they also need…
Real estate: Bankrupt Bay Area hotels are slated for auction
Court sets May schedule for sale of 15 hotels, including two in Bay Area https://www.mercurynews.com/2021/03/25/real-estate-bankrupt-bay-area-hotel-auction-covid-queen-mary/ By GEORGE AVALOS | gavalos@bayareanewsgroup.com | Bay Area News Group PUBLISHED: March 25, 2021 at 6:20 a.m. | UPDATED: March 25, 2021 at 10:14 a.m. SAN JOSE — A bankrupt hotel chain has won court approval for the sale of more than a dozen U.S. hotels, including two in the Bay Area, whose finances crumbled beneath economic blows that the coronavirus unleashed. The auction of the hotels is scheduled to be completed by the end of May and a private investment firm has been picked as a “stalking horse” to set a minimum bid for the 15 hotels involved in the sale, according to a bankruptcy court order. The Bay Area hotels due to be auctioned off in May are the Four Points by Sheraton at 1471 N. Fourth St. in San Jose and the Holiday Inn & Suites at 330 N. Bayshore Blvd. in San Mateo, according to documents on file with the U.S. Bankruptcy Court. The minimum price for the package of hotels is $470 million, the court files show. Monarch Alternative Capital is the bidder-to-beat in the auction. Monarch Alternative is a private investment firm that specializes in owning…
Fairmont San Jose owners target quick end to bankruptcy
Fairmont was nearly empty during worst of the coronavirus outbreak: court papers https://www.mercurynews.com/2021/03/24/fairmont-san-jose-hotel-owner-swift-bankruptcy-case-real-estate-covid/ By GEORGE AVALOS | gavalos@bayareanewsgroup.com | Bay Area News Group PUBLISHED: March 24, 2021 at 5:45 a.m. | UPDATED: March 24, 2021 at 2:36 p.m. SAN JOSE — The Fairmont San Jose owners have sketched out a swift endgame for the iconic hotel’s bankruptcy case in the first version of a formal plan to reorganize the property’s wobbly finances, court papers show. Newly filed court papers in the case point to the completion of the court case about four months after the Chapter 11 bankruptcy filing on March 5. That sort of schedule could conclude the bankruptcy case by sometime in July. Under the U.S. Bankruptcy Code, debtors have the exclusive right to file a plan of reorganization for at least the first 120 days, or four months, after a bankruptcy has been filed. Some debtors take more than two months, said Sam Singer, a spokesperson for principal hotel owner San Ramon-based Eagle Canyon Capital, whose president is Bay Area business executive Sam Hirbod. “We did it in less than 2 weeks,” Singer said. The primary creditor in the bankruptcy is CLNC Mortgage Sub-REIT, a unit of real estate financing and investment firm Colony…
Local Hotel Market Recovering
https://www.sdbj.com/news/2021/mar/10/local-hotel-market-recovering/ By Ray Huard Wednesday, March 10, 2021 Investors are starting to take a renewed interest in San Diego County hotels with industry experts predicting that 2021 will be a year of strong recovery. “There’s definitely been a change in how buyers look at hotels and I would say the one word that sums it up is optimistic,” said Alan Reay, president of Atlas Hospitality Group. “San Diego is already bouncing back very, very quickly,” Reay said. “If owners are looking to sell in San Diego, prices are definitely going to be higher in 2021 than they were in 2020.” The number of hotel sales in 2020 dropped from 22 in 2019 to 20 in 2020 and the average sales price per room dropped 12.1%, according to an Atlas Hospitality Group survey. Big Deals The largest hotel sold in San Diego County in 2020 was the 211-room Hotel Palomar for $62.8 million, according to the survey. The most expensive hotel sold in the county last year was the 192 room Residence Inn in Mission Valley that went for $67 million, according to the survey. Among the most recent sales, the 245-room Courtyard San Diego Downtown at 530 Broadway was sold for…
It’s official: Lafayette hotel sold for $25.8M
https://www.pacificsandiego.com/latest/story/2021-03-18/its-official-lafayette-hotel-sold-for-25-8m Prolific restaurant group known for Little Italy dining venues is the buyer of the historic El Cajon Boulevard property By LORI WEISBERG SAN DIEGO UNION-TRIBUNE MARCH 18, 2021 7:29 PM PT The historic Lafayette hotel, a North Park landmark that dates to the 1940s, has been sold to a local restaurant group for $25.8 million. The sale, which closed escrow Wednesday, will now clear the way for what could be a two-year restoration project that the new owner says will be the property’s “most significant overhaul” since its inception in 1946. Purchasing the 131-room hotel is San Diego-based CH Projects, which is making its first foray into the world of hotels. The restaurant group is well known for its continually expanding portfolio of San Diego drinking and dining venues, including Born & Raised and Ironside Fish & Oyster in Little Italy and Raised by Wolves in Westfield UTC. Its most visible hotel-related project, which has yet to open, is the rooftop venue it created on the 19th floor of the Intercontinental in downtown San Diego. “We closed yesterday, and I’m still pretty shocked,” said CH co-founder Arsalun Tafazoli, who declined to say how much his group plans to invest in the…
Restaurant Operator Makes First Hotel Foray With a Former Magnet for Celebrities in San Diego
CH Projects Plans New Food, Beverage Options for Historic Lafayette Hotel https://product.costar.com/home/news/shared/1867548097?utm_source=newsletter&utm_medium=email&utm_campaign=personalized&utm_content=p6 By Lou Hirsh CoStar News March 19, 2021 | 3:28 P.M. The historic Lafayette Hotel in San Diego, which attracted stars such as Bob Hope and Katharine Hepburn during its heyday in the 1940s and ’50s, has been sold to a restaurant operator that is venturing into the hotel business for the first time even as the pandemic wreaks havoc on that industry. San Diego-based CH Projects, which operates several upscale, full-service restaurants in the region, purchased the 131-room property that was originally built in 1946 at 2223 El Cajon Blvd. in the city’s North Park neighborhood. The $25.8 million sale comes after what brokers said was “significant” interest from multiple potential investors despite the struggles of the greater hospitality business. This is the first hotel purchase for CH Projects, which plans to restore and update rooms and add new food and beverage venues to the boutique property, according to a statement from brokerage Colliers International, which represented the seller, JCG Development of San Diego. “The Lafayette Hotel has great potential given the period architecture, gracious common areas, beautiful pool and vibrant North Park location,” said Colliers broker Victor Krebs, referring to…
Real estate: Bay Area hotels in bankruptcy go on auction block
Local hotels being auctioned off are part of $470 million sales package https://www.mercurynews.com/2021/03/11/real-estate-bay-area-hotels-bankruptcy-auction-block-covid-travel/ By GEORGE AVALOS | gavalos@bayareanewsgroup.com | Bay Area News Group PUBLISHED: March 11, 2021 at 5:45 a.m. | UPDATED: March 11, 2021 at 4:25 p.m. SAN JOSE — Two hotels in the Bay Area, one in the South Bay and the other on the Peninsula, are part of a coast-to-coast package of hotels that are being offered for sale by a bankrupt owner. Eagle Hospitality Trust, a Singapore-based real estate firm, seeks to sell 15 hotels around the country, including the two in the Bay Area, through what is known as a stalking horse auction that is used to determine a minimum price for the assets being sold. The two Bay Area hotels included in the auction are the Four Points by Sheraton at 1471 N. Fourth St. in San Jose and the Holiday Inn & Suites at 330 N. Bayshore Blvd. in San Mateo, according to documents on file with the U.S. Bankruptcy Court. The overall proposed purchase price for the 15 hotels is $470 million, court records show. Eagle Hospitality Trust, which owns 18 hotels in the United States, including eight in California — the world-famous Queen Mary Hotel in Long Beach…
Bankrupt Fairmont hotel can help spur downtown San Jose rebound, following reorganization
Fairmont San Jose owners seek favorable financing, improved management, new brand through bankruptcy https://www.mercurynews.com/2021/03/08/bankrupt-fairmont-hotel-spur-downtown-san-jose-rebound-covid-tourism/ By GEORGE AVALOS | gavalos@bayareanewsgroup.com | Bay Area News Group PUBLISHED: March 8, 2021 at 9:26 a.m. | UPDATED: March 9, 2021 at 8:30 a.m. SAN JOSE — Once it emerges from bankruptcy, downtown San Jose’s iconic Fairmont Hotel could help fuel a rebound in the city’s urban core as the region’s economy seeks to convalesce from the coronavirus. The 805-room Fairmont San Jose filed for bankruptcy on March 5 and closed its doors the same day, an abrupt shutdown that displaced guests, including the Vegas Golden Knights ice hockey team, which was playing the San Jose Sharks in an NHL game. “The Fairmont definitely can be successful in the future, once it has restructured its finances,” said Alan Reay, president of Irvine-based Atlas Hospitality Group, which tracks the lodging industry in California. The owners of the Fairmont San Jose hotel listed debts of at least $100 million and as much as $500 million as well as hundreds of creditors in the Chap. 11 bankruptcy filing to reorganize the hotel’s debts. “The fact that no one is talking about liquidation and that this is a reorganization says something about their confidence in the…
Fairmont Hotel in downtown San Jose files for bankruptcy
Upscale, iconic Fairmont in downtown San Jose closes doors — but will reopen within a few months https://www.eastbaytimes.com/2021/03/05/fairmont-hotel-downtown-san-jose-bankruptcy-covid-real-estate/ By GEORGE AVALOS | gavalos@bayareanewsgroup.com | Bay Area News Group PUBLISHED: March 5, 2021 at 4:18 p.m. | UPDATED: March 8, 2021 at 5:50 a.m. SAN JOSE — The Fairmont Hotel, a landmark in downtown San Jose, filed for bankruptcy on Friday and closed its doors — but says it will reopen and resume operations within two to three months. The owners of the iconic, 805-room hotel said they closed the Fairmont while they attempt to find a management partner and extend the existing mortgage debt. The Fairmont in San Jose is hardly alone with financial struggles amid the economic fallout unleashed by the coronavirus, which has chased away conventions and travelers from hotels. “We know that by taking this difficult step we will come back a more vibrant hotel to the benefit of everyone in San Jose, including the vitality of the city’s downtown, nearby businesses, and Silicon Valley conventions in a post-COVID-19 world,” said Sam Singer, a representative for the Fairmont Hotel. A growing number of hotels worldwide — and in the Bay Area — have tumbled into bankruptcy or faced problems with their financing….
Project Homekey Makes up Most of California’s Hotel Sales
https://spectrumnews1.com/ca/san-fernando-valley-ventura/business/2021/02/22/project-homekey-makes-up-most-of-california-s-hotel-sales BY JOSEPH PIMENTEL ORANGE COUNTY PUBLISHED 8:00 AM ET FEB. 23, 2021 IRVINE, Calif. — Gov. Gavin Newsom’s Project Homekey accounted for $890 million of hotel sales in California last year, reviving what would have been a paltry year in terms of hotel transactions in the state. While sales of hotels across the nation sagged due to the coronavirus pandemic, California was the only state to record an increase in the number of hotel transactions year-over-year, said Alan X. Reay, president of Atlas Hospitality Group. “Project Homekey helped hotel owners that were looking to sell last year but had no other takers at the prices they were expecting, which is where Project Homekey stepped in,” Reay told Spectrum News. “Without Project Homekey, California would have seen 26% less individual hotel sales and 61% less in total dollar volume.” What You Need To Know Hotels sold using the state-sponsored Project Homekey accounted for $890 million in hotel sales last year California was the only state in the nation to record an increase in the number of hotel transactions year-over-year Gov. Gavin Newsom launched Project Homekey as a way to house the homeless and those at-risk of homelessness by converting hotels…
Hotel Bankruptcies On The Rise As Lenders Lose Patience With Recovery
https://www.bisnow.com/national/news/hotel/hotel-bankruptcies-becoming-more-frequent-as-lenders-lose-patience-with-recovery-107807 February 18, 2021 Jon Banister, Bisnow Washington, D.C. The past year has been a historically harmful time for the hotel industry as the coronavirus pandemic pushed demand off a cliff, and it has yet to climb back up. This fall wasn’t accompanied by an avalanche of hotel bankruptcies, as lenders provided enough forbearance to keep hotel owners hanging on throughout much of 2020. That is now beginning to change. A string of hotel bankruptcy cases have been filed in the last two months, and hospitality finance experts believe this trend will continue to increase as owners of still-struggling hotels remain unable to pay their debt service and lenders are less flexible than they were a year ago. “One of the reasons we’re starting to see increased activity in terms of foreclosures now is lenders don’t have the same sense of patience, and they don’t have much confidence in a sharp rebound,” said Herrick Feinstein partner Stephen Selbst, a New York-based bankruptcy lawyer. Some lenders are still granting flexibility to borrowers in hopes that the market will rebound this summer, experts say. But every day that passes with hotel occupancies remaining low means more lenders leaning toward foreclosing on properties. With many hotels on the brink of foreclosure, the next two quarters of…
Hotel Portfolio Heads for Possible Sell-Off Amid Bankruptcy Filing
Signs of Hospitality Distress Growing As Pandemic Drags On https://www.costar.com/article/1892720472/hotel-portfolio-heads-for-possible-sell-off-amid-bankruptcy-filing By Lou Hirsh – CoStar News Jan 22, 2021 | 1:13 AM A prominent Singapore-based hospitality operator has begun the process of selling off an 18-hotel U.S. portfolio amid a bankruptcy filing, the latest sign of financial struggle for the hard-hit hotel industry. Eagle Hospitality Trust this week filed for Chapter 11 bankruptcy protection so that it can reorganize its finances and prepare for the potential sell-off of its properties, including the vintage former transatlantic cruise ship The Queen Mary, which was converted into a hotel in the 1970s and is now docked in the harbor of Long Beach, California, south of Los Angeles. Eagle Hospitality Trust did not return requests for comment. It could be a sign that more such filings are on the way with property owners awaiting a potentially slow return to pre-pandemic levels of leisure and corporate travel. “I have not heard of others, but do expect more,” said Alan Reay, president of hotel brokerage and research firm Atlas Hospitality Group, referring to recent finance-related events including this week’s bankruptcy filing by Eagle Hospitality Trust. Hospitality businesses have been hard-hit by the coronavirus pandemic. Hotel owners have been working out…
