28 September, 2022

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Bankrupt Bay Area hotels are slated for auction

SAN JOSE — A bankrupt hotel chain has won court approval for the sale of more than a dozen U.S. hotels, including two in the Bay Area, whose finances crumbled beneath economic blows that the coronavirus unleashed.

The auction of the hotels is scheduled to be completed by the end of May and a private investment firm has been picked as a “stalking horse” to set a minimum bid for the 15 hotels involved in the sale, according to a bankruptcy court order.

The Bay Area hotels due to be auctioned off in May are the Four Points by Sheraton at 1471 N. Fourth St. in San Jose and the Holiday Inn & Suites at 330 N. Bayshore Blvd. in San Mateo, according to documents on file with the U.S. Bankruptcy Court.

The minimum price for the package of hotels is $470 million, the court files show.

Monarch Alternative Capital is the bidder-to-beat in the auction. Monarch Alternative is a private investment firm that specializes in owning bankrupt companies and properties and delinquent debts.

Bids that might top Monarch Alternative’s court-established price of $470 million for the entire package are due to be submitted by May 14. The auction is slated to be held on May 20. The auction’s ultimate winner is scheduled to be approved by the court on May 28.

Eagle Hospitality Trust, a unit of a Singapore-based real estate firm, filed for bankruptcy in January.

The court papers show proposed purchase prices for several of the hotels.

Four Points by Sheraton in north San Jose has a proposed purchase price of $33.5 million, court records show.