Thor Equities misses loan payment on Palmer House Hilton, risking default

The 1,600-key hotel is the 2nd biggest in the city, whose hotel industry has been decimated by the coronavirus

TRD CHICAGO /
Apr.April 21, 2020 11:02 AM
Thor Equities’ Joseph Sitt and the Palmer House Hilton at 17 East Monroe Street

Thor Equities’ Joseph Sitt and the Palmer House Hilton at 17 East Monroe Street

The coronavirus has crippled the Chicago hotel industry and now Thor Equities may be in danger of defaulting on its mortgage on the 1,600-key Palmer House Hilton.

The New York-based firm skipped its April loan payment on the $427 million refinance it took out on the property in 2018, Crain’s reported, citing Bloomberg loan data. Thor bought the Palmer House — at 17 East Monroe Street — for $230 million in 2005, and finished a $131 million renovation in 2008.

The CMBS loan has been transferred to a special servicer, signalling the potential for default. Thor failed to pay its $1 million debt service this month on the hotel, Crain’s reported.

Numerous hotels in Chicago have been forced to shutter, and overall occupancy has tumbled to 18 percent, according to the latest figures from hotel data firm STR. Revenue per available room was at $12.78.

More than two-dozen city hotels have CMBS debt of $10 million or more, according to a Crain’s report.

The trend is happening throughout the country. As the pandemic continues to roil the CMBS market, loans on hotel properties have been ahead of the curve when it comes to delinquencies and special servicing. Three massive CMBS hotel portfolio loans, covering 186 hotels — Homewood Suites Chicago Downtown included is among them — with a total outstanding balance of about $2 billion, were among the largest to be transferred into special servicing so far this month. [Crain’s]Alexi Friedman 


Related Articles

arrow_forward_ios
Suburban new home purchases surged in the second quarter, propelled by record-low mortgage rates and the need for more space amid the pandemic. (iStock)

Chicago suburbs see surge in new home sales

Chicago suburbs see surge in new home sales
Vista Property principal Hymie Mishan, whose company is betting on the West Loop office market. (Images via Vista Property)

Vista Property plans 15-story office building in West Loop

Vista Property plans 15-story office building in West Loop
Chicago will direct $33 million to help renters and homeowners avoid eviction and foreclosure (iStock)

Chicago ups ante to help residents avoid eviction, foreclosure

Chicago ups ante to help residents avoid eviction, foreclosure
The former Target in Calumet City will be converted into a working farm (Google Maps)

For latest retail redevelopment, old Target will become new farm

For latest retail redevelopment, old Target will become new farm
(iStock)

Chicago’s office market hits ugly vacancy number

Chicago’s office market hits ugly vacancy number
The Chicago area is one of the most at-risk nationwide to rising home foreclosure rates, according to a recent report (iStock)

Treading water: Chicago housing market among most at-risk to foreclosure, report shows

Treading water: Chicago housing market among most at-risk to foreclosure, report shows
One Bennett Park’s Lawn Bowl, Optima Signature, and JeffJack Apartments

Privacy is the newest amenity

Privacy is the newest amenity
CCC Information Services’ CEO Githesh Ramamurthy and 167 North Green Street in Fulton Market. (Ramamurthy courtesy McKinsey & Company; 167GreenSt)

Corona cut: Software products firm trims lease space at Shapack’s 167 N. Green

Corona cut: Software products firm trims lease space at Shapack’s 167 N. Green
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...