The hotel market in Chicago, where two big foreclosures are in the news, has a long way to go before it returns to pre-pandemic levels.
The occupancy rate in the Windy City stood at 56 percent in the first six months of 2021, compared with 67 percent in the last pre-Covid year of 2019, the Chicago Business Journal reported. Revenue per available room dropped to $81 from $94.
Chicago’s hotels are performing on par with other big U.S. cities. In New York, the occupancy rate dropped to 68 percent from 83 percent in 2019, and revenue fell to $172 from $195. The rate declined in Los Angeles to 70 percent from 79 percent in 2019.
The local shakeout has made headlines in Chicago recently. Wells Fargo won an auction bid for the JW Marriott Chicago hotel on Monroe Street after the owner, a venture of Orlando-based Estein USA defaulted on a $203.5 million loan for the hotel.
In addition, a judge ordered a foreclosure on the Palmer House Hilton after its owner, Thor Equities, failed to make payments on its mortgage on the property.
There are some bright spots. Chicago hotel occupancy rates rose about 15 percent last week to 73 percent, the second-biggest gain across the top 25 U.S. behind New Orleans, where occupancy rose about 17 percent.
Chicago hotels also had the largest gain in average daily rates over 2019. They rose 49 percent to $170.
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[CBJ] — Victoria Pruitt