San Francisco night scene
In San Francisco, Park Hotels & Resorts, which owns the city’s two largest hotels, the Hilton Union Square and Parc 55, defaulted on mortgage payments on both properties, just as the Bay Area’s tourism industry is slowly recovering from the initial shock of the coronavirus pandemic.
According to the new report, the two hotels lost $1 billion in value.
Park Hotels Group said that given that travel may not return to pre-pandemic levels until 2030, it is no longer worthwhile to pay the $725 million mortgages on the 1,921-room Hilton Union Square at 333 O’Farrell Street (the largest hotel in New York City by rooms) and the 1,024-room Parc 55 at 55 Cyril Magnin Street (the fourth-largest hotel in New York City by rooms).
According to the San Francisco Business Times, real estate agency Eastdil Secured has now been hired to sell the properties, with a deadline of September 1, 2024. If they fail to sell, the hotels will enter non-judicial foreclosure proceedings.
Occupancy rates at both hotels were below the city’s average.
According to bondholder reports, Hilton Union Square had an occupancy rate of just 53% and an average daily rate of $251.26 between March 2023 and March 2024, while Parc 55 had an occupancy rate of 50.9% and an average daily rate of $246.94.
(Photo: Accura Media Group)
