San Francisco’s century-old Huntington Hotel atop Nob Hill closed ‘until further notice’ in September after it defaulted on its mortgage, and now $52 million of its debt is on the market.
Woodbridge Capital owns the hotel property, while Deutsche Bank is the debt lender.
“The loan provides a unique opportunity for an investor to acquire an upscale hotel-secured NPL in one of San Francisco’s most exclusive neighborhoods,” according to listing by New York-based JLL agent Tom Hall. York and specializes in loan and REO sales.
The agency said it could not comment on the offer, but the listing said it had been “exclusively retained by the lender to arrange the sale of a $52.2 million senior non-performing loan. dollars” on the borrower’s simple interest in the historic Nob Hill Hotel. JLL also listed the hotel’s $13.5 million mezzanine loan debt to Walton Street Capital in February 2021, according to The Registry.
The Huntington Hotel was built as an apartment building in 1924 and is famous for its Big 4 restaurant, named after the ‘Big Four’ business tycoons of the time: Collis Huntington, who also gave his name at the hotel; Leland Stanford; Charles Crocker; and Mark Hopkins, who has a prominent hotel named after him across the street. The Huntington is also home to the 11,000-square-foot Nob Hill Spa, which offers one of the few indoor pools in town. The hotel, restaurant and spa have all been closed since April 2020.
A subsidiary of Woodbridge Capital has owned the 12-story, 134-key hotel since September 2018, when it purchased the property from Singapore’s Grace International for $51.9 million, according to the San Jose Mercury News. Including penalties, late fees and unpaid interest, Deutsche Bank says it owes a total of $61.1 million.
The loan originated in September 2018 with an initial balance of $47 million or $351,000 per key, according to the listing. It has been in default since November 2020 and reached its default maturity in October 2021. Foreclosure proceedings began in August 2022, “providing investors with a fast track to recovery”.
No price was given for the debt offering and obtaining further information from JLL requires signing an electronic non-disclosure agreement.
Hotel sales in the Bay Area fell $2 billion in the first half of the year, according to a recent report by Atlas Hospitality Group. The consultancy attributed the drop to the lingering effects of the pandemic and rising interest rates.
The total dollar volume of hotels purchased in the Nine Counties Bay Area was nearly $661 million, down two-thirds from the nearly $2 billion in hotel purchases over the past six first months of 2021, according to Atlas.