With hotels recovering from the recession, foreclosures still persist
The hotel industry may have risen like a phoenix from the ashes of recession, but it doesn’t mean all hotel owners are able to pay their bills on time. Bank foreclosures, in fact, still exist. The fact of which still makes it a great time to buy?particularly if you can at auction.
Today comes news about a couple of Hilton hotels that?have and are?going through?the foreclosure process.
One is the Antlers Hilton in Colorado Springs, Colo., which is facing an uncertain future after receiving a foreclosure notice. According to the El Paso County Trustee’s Office, and as reported by FOX 21 News, the owners owe more than $30 million on their loan.
“In Colorado when you borrow money to buy property or against property you sign an agreement that you’re borrowing money, you agree to pay them back. If you don’t pay them the money the lender has the right to ask our office to foreclose on the property,” Tom Mowle, public trustee, told the media outlet.
Now, the owners must scramble; they have until November 20 to come up with the cash. If they don’t the hotel could be headed for auction.
The rub: What’s owed (around $36 million) is more than what the hotel is estimated to be worth (around $25 million).
“It does suggest that the current owners are having financial difficulties, but what that has to do with, whether that’s entirely based on what’s happened in Colorado Springs or elsewhere I just don’t know,” Mowle said.
Back east, another Hilton, which already went through foreclosure, is now available at auction. WFTV reports that the Hilton Daytona Beach Oceanfront Resort in Florida is going up for public auction next week.
The owners of the hotel, reportedly the largest in Daytona Beach, a popular Spring Break destination, owe more than $100 million on it. A bank foreclosed on the hotel last month. It had an outstanding debt of $113 million.
The hotel is also in need of a renovation, many say, including locals. If the hotel is acquired by a new owner without debt, it will allow them an easier path to invest money toward a refresh.
But it remains uncertain if the bank will find a buyer. According to the Volusia County property appraiser, the hotel is worth only $43 million, far off the $142-million amount it sold for in 2007.