UPDATED, March 28, 2022, 9:20 a.m.: Chinese developer Jubao Xie is facing the long descent from the top of the tallest Holiday Inn in the world.
Lending bank Wilmington Trust filed to foreclose on a $137 million loan on the 50-story hotel at 99 Washington Street in the Financial District, PincusCo reported. The 10-year, non-recourse, interest-only, fixed-rate loan at the 492-key hotel was provided four years ago, but the hotel has been in distress for some time.
Xie previously attempted to sell the hotel back in 2017, seeking more than $300 million. Earlier this year, Xie again attempted to sell both the hotel and the 8,500-square-foot St. George Tavern next door, hoping to get $187 million for the two properties. Eric Anton of Marcus & Millichap marketed the properties.
The hotel had been facing foreclosure for some time, as three loans connected to the property have been delinquent since August 2020, according to data from Trepp. By December 2020, the building was reportedly more than 90 days delinquent on $87 million, making it one of the most distressed hotels in the entire city.
Xie developed the hotel in tandem with Sam Chang before taking full control of the property in 2014. Crain’s reported the IHG-operated hotel had an occupancy rate of 90 percent when the 2018 refinancing occurred.
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This is the latest sour development in New York City’s struggling hotel market. Earlier this month, one of the city’s largest hotels was sold at a nearly $400 million loss when MCR agreed to acquire the Sheraton New York Times Square from Host Hotels & Resorts for $356 million. The 1,780-key hotel last sold in 2006 for $738 million.
Elsewhere on the Holiday Inn market, Watermark Capital has been exploring a sale of the 226-key hotel at 125 West 26th Street in Chelsea. The investment firm purchased the building in 2013 from Magna Hospitality for $113 million.
The Chelsea Holiday Inn fell behind on its mortgage payments in October 2020 and the loan was transferred to a special servicer soon after. The hotel was only 54 percent occupied as of the fall and cash flow had turned negative.
A previous version of this article incorrectly named Ladder Capital as involved in the foreclosure.
[PincusCo] — Holden Walter-Warner