BPM Real Estate Group has defaulted on a $127 million loan tied to an Anaheim hotel project, The Real Deal has learned.
BPM, based in Portland, used the loan to build the 12-story, 326-key Viv Hotel at 1601 South Anaheim Boulevard. But as of Nov. 1, BPM owed about $145 million under the construction loan, according to a notice of default filed with Orange County.
BPM did not respond to a request for comment.
Miami-based commercial lender 3650 REIT provided a $115 million senior construction loan for the project in 2018, a release at the time said, shortly after the developer scored entitlements to build the hotel.
BPM opened the hotel in 2020 — originally under the Radisson Blu brand — but needed more money. The loan from 3650 REIT was upsized in September 2022 to $127 million, according to the default notice.
Under California law, a foreclosure for the property can be scheduled no earlier than Feb. 11. BPM can legally sell the property before a foreclosure takes place.
The hotel, now called the Viv, is located about a mile from Disneyland Resort — a proximity advantage in the pitch for the project.
Many hotel owners have defaulted on loans over the last year and a half, as interest rates have soared and experts say business travel is still lackluster compared to 2019 levels. It’s unclear what affected BPM’s ability to pay off the loan.
Hotel sales across California have also plummeted, alongside commercial real estate sales in general.
In the first half of the year, 62 hotels in Southern California traded hands — down 60 percent from the same period in 2022, according to Atlas Hospitality Group. That drop is most likely attributed to an investor freeze after interest rates started soaring.
BPM is betting its developments in its home city of Portland will pan out. The firm recently opened a 35-story Ritz Carlton tower, which cost $600 million to build. The tower has 251 rooms and 132 hotel-branded condos.