Home News Financial District Holiday Inn Files Bankruptcy

Financial District Holiday Inn Files Bankruptcy

by admin
0 comment

Holiday Inn at 99 Washington Street (Google Maps, Getty)

A Holiday Inn hotel in the financial district has filed for bankruptcy as its owners try to avoid foreclosure.

Developer Jubao Xie put the 492-room hotel at 99 Washington Street into Chapter 11 on Tuesday, saying the hotel is performing well after being hit by Covid but will renegotiate with creditors. I explained that it was necessary.

The question is, how much does Xie have to pay to get the hotel out of default?

According to Tarter Klinski & Drogin bankruptcy attorney Scott Markowitz, the owners have a total outstanding balance of about $10 million. It’s not an impossible number, lawyers said.

But default interest adds $16 million to that, Markowitz said, along with late fees and workout fees. He said loan servicers should be more flexible in their negotiations with Xie, given the impact the pandemic has had on hotels.

“There’s a big difference between $10 million and $26 million,” he said. real“From our perspective, we think it’s unfair because of Covid.”

Special servicer Midland Loan Services did not immediately respond to a request for comment.

Xie and his lawyers told the court that the hotel was set back by Covid shutdowns and the Omicron surge, but now has enough cash flow to pay off its debts.

Court documents list assets of $177.6 million and liabilities of $143.3 million. Xie said he lent millions of dollars to keep the hotel up and running during the pandemic and needed bankruptcy protection to keep his assets in the face of foreclosure.

Xie developed the 50-story hotel with Sam Chang in 2010 and fully managed the hotel in 2014. In 2018 he refinanced his $137 million loan from Ladder Capital. This debt is now split between CMBS bondholders and multiple tranches held by Triangle Capital. group.

The hotel owner defaulted in 2020. In March of this year, the bondholder’s trustee, Wilmington His Trust, filed for foreclosure on the property.

Xie said in the filing that the hotel has recovered over the past six months, with occupancy rates above 90% in September and October.

New York hotels are struggling as business travel and events have not fully recovered despite a recovery in tourism.

In September, the lender filed a foreclosure on the ground below 1,331 rooms. Row NYC Hotel Near Times Square and 697 Rooms Maxwell NYC Located on Lexington Avenue.

Approximately 10,000 rooms never open again After the first shutdown of 2020.

You may also like