Atlas in the news
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Hotel workers union solicits surprising ally: Wells Fargo
By Alex Barreira – Staff Reporter, San Francisco Business Times Nov 20, 2024 | Updated Nov 20, 2024 7:15am PST As the contract impasse between San Francisco hotel workers union Unite Here Local 2 and operators Hilton, Hyatt and Marriott nears its 100th day, the union is turning its appeals to a surprising place: Wells Fargo. The big bank is the master servicer of the $725 million loan guaranteed by the city’s largest hotel complex, the Hilton San Francisco Union Square and Parc 55. As such, it’s obligated to defend the interest of bondholders. So the union has tried to recruit Wells Fargo and the Hilton bondholders to its side and pressure the operators to come to terms. Unite Here said it hopes that with enough pressure, Wells Fargo will put in a word with Hilton to give in to the union’s demands on health care, shift allotment and wages in the next collective bargaining agreement. The union has agreed to contracts with individual Hiltons in Boston, Honolulu, San Diego, San Jose and Baltimore, but not in San Francisco. In the meantime, Unite Here is doing what it can to make Hilton and the bondholders feel that time without a…
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Hilton San Francisco Union Square, Parc 55 hotels narrow in on buyer
By Alex Barreira – Staff Reporter, San Francisco Business Times Nov 18, 2024 San Francisco’s largest hotel complex is inching closer to a buyer. Eastdil Secured, acting as broker, submitted its first and final calls for bids on the Hilton San Francisco Union Square and Parc 55 hotels and “several offers are presently under review,” according to a bondholder report this month on the properties’ associated debt. The connected and jointly managed hotels, with nearly 3,000 rooms combined, have been under court-appointed receivership for just over a year since former owner Park Hotels & Resorts handed in the keys rather than pay off its related $725 million loan. The receiver, Michelle Russo of Hotel Asset Value Enhancement, has a deadline to contract a buyer by March 31, 2025. Since Eastdil’s offering memorandum went out in July, the broker has collected at least 70 confidentiality agreements related to buyer discussions with “many large national and international names,” per the bondholder report. In September Eastdil began conducting tours and was participating in daily buyer phone calls. Per the report, the hotels are being offered to buyers with or without the existing debt in order to maximize the potential return for bondholders. The…
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East Bay hotel is bought for one-fourth prior price as lodging market wobbles
Deal underscores weakening hotel values in the Bay AreaBy George Avalos | gavalos@bayareanewsgroup.com | Bay Area News Group UPDATED: November 18, 2024 at 8:57 AM PST OAKLAND — An Oakland hotel has been bought at a price that suggests the high-profile property’s value has nosedived since the end of the coronavirus outbreak. Courtyard Oakland Downtown, a Marriott brand, was bought for $10.6 million, according to documents filed on Oct. 2 with the Alameda County Recorder’s Office. The 162-room hotel in downtown Oakland was bought by an affiliate controlled by Core Property Capital, the county public records show. The buyer paid a jaw-dropping 76% less than the $43.8 million that the seller, a Gaw Capital Partners affiliate, paid in 2016 for the downtown Oakland hotel. Core Capital’s purchase price also is well below the hotel’s estimated value of $44.6 million as of January 2024, as calculated by the Alameda County Assessor’s Office. The hotel is at 988 Broadway in downtown Oakland. The five-story lodging property is a full-service hotel with 1,300 square feet of ground-floor retail and 2,700 square feet of meeting space. Core Property Capital, the hotel’s new owner, is a “private investor with known interests in 14 assets that have an estimated property value…
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City Profile: Big events test LA’s hotel market
By Nellie Day Nov 12, 2024 8:00am Los Angeles has always been synonymous with fame, thanks to Hollywood and its entertainment production powerhouses. In addition to awards shows – think Grammys, Emmys, Oscars, etc. – Los Angeles pulls travelers thanks to its weather, many area attractions and convention business. Some hotel investors are optimistic that a new wave of high-profile events will continue to diversify LA’s offerings and buoy the market’s post-pandemic recovery. That’s because this upcoming glut of events is centered around sports. “Los Angeles certainly has some very high-profile events that will contribute to a hotel’s profitability,” says Robert Feist, vice president of Atlas Hospitality Group. “The upcoming events, such as the World Cup and the Olympics, are great events for the city.” High-profile breeds high-profile The region will take center stage among the sports world over the next few years as it hosts the FIFA World Cup and NBA All-Star Game in 2026, Super Bowl LXI in 2027 and the Summer Olympic games in 2028. In addition to these high-profile events, the LA region hosts regular games from its National Football League (NFL’s Chargers and Rams), National Basketball League (NBA’s Lakers and Clippers), Major League Baseball (MLB’s Dodgers and Angels,…
Big San Jose hotel files for bankruptcy but will keep operating as usual
Owner of hotel is in talks with new lenders to replace current financier By GEORGE AVALOS | gavalos@bayareanewsgroup.com | Bay AreaNews Group UPDATED: November 6, 2024 at 5:36 AM PST SAN JOSE — A landmark San Jose hotel has filed for bankruptcy for the second time in three years but will keep its doors open and operate as usual while its owner seeks fresh financing for the lodging tower. The entity that owns the iconic Signia by Hilton San Jose hotel in the city’s downtown has filed for a Chapter 11 bankruptcy proceeding ahead of a scheduled auction of the lodging property, U.S. Bankruptcy Court records how. “The hotel will operate exactly as it has been,” said Sam Hirbod, principal owner of the Signia by Hilton at 170 South Market Street in downtown San Jose. “The doors are staying open. The guests will notice no difference.” The bankruptcy filing is the latest visible sign of a financial conflict between the 541-room hotel, which is one of the largest in the Bay Area, and lender for the high-profile property, BrightSpire Capital. BrightSpire had provided the hotel with a financing package that as of July 2024 totaled about $165.3 million. The default,…
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Santa Ana’s Embassy Suites Sells for $41M
BY EMILY SANTIAGO-MOLINA | NOVEMBER 4, 2024 A Newport Beach-based hospitality firm’s latest Orange County transaction marks the region’s second-largest hotel sale of the year after the recent take over of the Pacific Edge hotel in August. An affiliate of MHG Capital acquired the Embassy Suites by Hilton Santa Ana-Orange County Airport from Windsor Hospitality on Oct. 17 for $41 million, or $136,992 per key. Earlier this year, Pacific Edge traded hands for $80 million, or $640,000 per key. Newport Beach-based MHG now counts six hotels in its local portfolio. The hospitality firm’s last OC purchase was of The DoubleTree by Hilton Suites Anaheim Resort Convention Center for $62 million in 2023. The seven-story property is ranked No. 37 among OC’s largest hotels by number of rooms, according to Business Journal data. Property Declined 42% in Value The 301-room Embassy Suites, first opened in 1985, is located at 1325 E. Dyer Road just off the Costa Mesa (55) Freeway. Windsor Hospitality, a hotel investment firm headquartered in Santa Monica, is also a stakeholder in the 228-room Embassy Suites Brea-North Orange County hotel. The transaction was listed as a debt assumption. In 2017, the property was appraised for $70.4 million and…
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Hotel De Anza in downtown San Jose bought for just over $11 million
Historic hotel is bought for far less than its prior price By GEORGE AVALOS | gavalos@bayareanewsgroup.com | Bay Area News Group UPDATED: October 30, 2024 at 4:13 PM PST SAN JOSE — The historic Hotel De Anza in downtown San Jose was bought at a price that’s roughly half of what it was previously worth. Purchased for $11.5 million, according to documents filed Tuesday with the Santa Clara County Recorder’s Office, Hotel De Anza’s price could be an additional sign of weakness in the lodging market. An ownership group headed up by Dhaval Panchal, a Northern California hotel owner, bought the the 10-story historic hotel at 233 West Santa Clara St. in downtown San Jose. The $11.5 million price is 43.6% below the $20.4 million that an affiliate of Lowe’s Enterprises paidin 2014 for the historic high-rise. “This could hurt hotel values throughout the Bay Area,” said Alan Reay, president of Irvine-based Atlas Hospitality Group, which tracks the California lodging market. “San Jose, Silicon Valley, San Francisco, it even affects Oakland.” Even worse, the price for the Hotel De Anza is 54% below the hotel property’s value of $25.2 million in January 2024, as the Santa Clara County Assessor’s Office…
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Big San Jose hotel seeks fresh financing to replace loan that’s in default
Discussions are in final stages to land new funding but bumpy road looms By George Avalos | gavalos@bayareanewsgroup.com | Bay Area News Group UPDATED: October 20, 2024 at 7:36 a.m. SAN JOSE — The owner of a big San Jose hotel has crafted a plan to land a crucial round of financing for the lodging tower — even as the current lender threatens to foreclose on a delinquent loan for the iconic property. The financing maneuvers involve the highrise Signia by Hilton San Jose, a 541-room hotel at 170 South Market Street in downtown San Jose. Sam Hirbod, principal owner of the hotel property in the city’s trendy and hip SoFA district, has been working for months to cobble together permanent funding on attractive terms for the hotel. The current lender, BrightSpire Capital, has provided the hotel with a financing package that as of July 2024 totaled about $165.3 million. In a move that could trigger a foreclosure of the hotel’s loan, BrightSpire has filed a notice of default and has scheduled an auction on the property. Hirbod in recent days thought he had secured a new financing deal. Hirbod added that the terms were so onerous that both his ownership group and Hilton decided…
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New hotel at SoFi Stadium to cater to athletes and fans
By Roger Vincent | Staff Writer | Oct. 11, 2024 3 AM PT Construction is underway on a $300-million hotel next to SoFi Stadium, the latest addition to Rams owner Stan Kroenke’s sprawling mixed-use development on the former site of the Hollywood Park horse racing venue in Inglewood. The 300-room Kali Hotel is the only hotel in Kroenke’s master plan for Hollywood Park, and developers hope it will be a favored place to stay for visiting football teams and basketball teams, as well as fans who come to see them play. It is being erected by real estate developer Kali P. Chaudhuri, whose company KPC Development Co. owns and builds commercial properties in California and India. It will be the company’s first hotel in the United States. The hotel will rise 12 stories on Stadium Drive, across a man-made lake from the 70,000-seat stadium, which is home to L.A.’s two NFL teams, the Rams and Chargers. It will be near to the YouTube Theater and within walking distance of the Intuit Dome, the recently opened home of the Los Angeles Clippers, and Kia Forum, which are not part of the SoFi development project. Known officially as the Kali Hotel and Rooftop, Autograph Collection,…
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Ramada Hotel in Costa Mesa Sells for $20.5M
BY EMILY SANTIAGO-MOLINA | SEPTEMBER 16, 2024 The ownership of the Ramada by Wyndham Costa Mesa/Newport Beach hotel sold the 137-room property to hospitality firm Excel Hotel Group for $20.5million. The three-story resort was built in 1983 and went for $149,444 per room in August, according to CoStar. The seller, B D Inns Inc., recruited Alan Reay’s Atlas Hospitality Group to help search for a new owner. “It’s not very often that this kind of property becomes available,” Vice President Justin Myers from Atlas told the Business Journal. Myers represented the seller. Oliver Shah, a broker also from Atlas, represented Excel. Myers said the property became available because the previous owners, who had owned the hotel for 30 years, were ready to make a deal. Atlas set out to select a hospitality group who could perform well. Excel, a property ownership, management and development company based in San Diego, took over both ownership and management of the hotel. The firm’s current portfolio includes 26 hotels with a 128-room Residence Inn in Paso Robles under development. The Ramada marks Excel’s second property in Orange County, the first being SpringHill Suites Huntington Beach Orange County. The firm bought SpringHill in 2015 for…
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Universal City hotel expansion project clears early approval hurdle
By Roger Vincent | Sept. 18, 2024 1:33 PM PT Construction of a new high-rise addition to the Hilton hotel in Universal City was approved by the Los Angeles Planning Commission, clearing a major hurdle for the long-planned expansion. The decision comes as Universal Studios and other popular tourist destinations in the region shine for hoteliers even as other properties in California’s urban centers struggle to fill their rooms. The commission recommended last week that the City Council approve construction of an 18-story addition to the 24-story Hilton Los Angeles/Universal City hotel, which opened in 1984. The addition would have 395 rooms, bringing the total between the two structures to 890 rooms, putting that Hilton among the ranks of the largest hotels in Los Angeles County. Hotels near popular leisure destinations such as Disneyland and Universal Studios Hollywood are outperforming California hotels that are intended to serve business travelers and meetings, said hotel consultant Alan Reay, president of Atlas Hospitality Group. “Big full-service hotels have been really impacted by the work-from-home movement and the pullback of the convention and meeting business,” Reay said. Universal City is “a little island that is doing phenomenally well,” he said, with average occupancy at the Hilton…
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Interest rates drag down hotel sales in Los Angeles and across the state
By Caroline Petrow-Cohen | Staff Writer | Sept. 12, 2024 9:14 AM PT Hotel sales are flagging in Los Angeles County and throughout the state as high interest rates and smaller-sized deals have been a drag on the market, according to a recent industry report. During the first six months of the year, the number of hotels that traded hands in L.A. County dropped 6% compared with the same period last year, while the amount of money involved in the sales plummeted 79%, the report by Atlas Hospitality Group concluded. A lack of big-ticket transactions accounted for the steep dropoff, said Alan Reay, president of Atlas Hospitality Group. “What we saw in the first six months of 2024 versus 2023 is a lot smaller transactions,” Reay said in an interview. “There were no trophy or bigger full-service hotels that closed in the first six months.” California is home to about 10,000 hotels and used to see roughly 400 to 450 hotel sales per year. In the first six months of 2024, there have been 122 sales. “It’s substantially below what we typically see in a normal year for California,” Reay said. Across the states, hotel sales have been declining over the last…
