In Part 1 of this blog topic, I talked briefly about the the cost of hotel receivership services related to a rents and profits action and a court appointed hotel receiver and interim hotel management. Where there is a judgement to collect, such as an outstanding balance owed on sales taxes or a defaulted second…
Distressed hotels will be in a good position to see valuations continue rising based on demand and expense projections. This is despite the potential for more foreclosures in 2012 with loans coming due from loans refinanced in 2005 and 2006. The added supply of defaulted hotel loans does not suggest that there will be “fire…
Hotel receiverships and foreclosures continue to wane while the appetite by lenders to modify these loans is on the rise again. Sometimes dubbed extend and pretend during the early years of this last recession, continued strong performance in the lodging real estate sector is driving the upside in hotel fundamentals. Better operating results in turn…
Recent reports about the amount of distressed hotels on the horizon suggest that cheap hotel real estate deals will be very hard to find. It is also unlikely that lenders will foreclose or hold ORE hotel assets for very long. Both the rise in hotel industry income fundamentals and the ability for banks and special servicers…
In this economy, many owners are turning to a lawyer and hotel motel consultant about canceling the management agreement when the hotel or resort is not performing according to plan. Worse, is if whatever gain is realized only benefits the operator, which can be the case if they have not invested any of their own…
As the lodging industry starts to stabilize, hotel and motel management companies will face tougher performance measures if the properties they manage lose the franchise. Owners of older hotels and motels that have not kept their up property with a PIP (Property Improvement Plan) can expect less leniency and more aggressive contract terminations as a…
There were three important articles recently that suggest the long awaited distressed hotel deals for investors and their hotel investment advisors may or may not begin to increase in 2011 going forward based on your interpretation of the message. However, an important inference amongst all are that a large amount of distressed commercial real estate…
More and more Commercial Lenders and CMBS Special Servicers with defaults and non-performing hotel loans on the rise are now considering the use of Hotel Receiverships as a possible solution to recovery. Not wanting to foreclose on potentially devalued hotel assets in a bad economy, many Special Assets Managers and their workout and restructuring professionals…
There is a lot of talk among investors and their hotel asset manager that acquisitions in distressed real estate of the U.S. hotel sector will rise this year. Still, the focus continues to be on the luxury, trophy class of hotels in primary markets when and where these become available. Hotel High Net Worth InvestorAccording…
One of the key reasons to have a court appointed receiver take control of a distressed hotel is to maintain and preserve its assets, such as the building, FF&E, cash and revenue streams. However, another primary asset that should not be overlooked is its rating among its guests and patrons, which includes its class and…