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Ashford sells distressed W Hotel in Atlanta
Stonebridge paid a little under $25M; less than half its 2015 value
Monty Bennett’s Ashford Hospitality Trust has evaded foreclosure proceedings with the sale of a ritzy hotel in downtown Atlanta, spotlighting the firm’s offloading strategy.
Colorado-based Stonebridge Hospitality Management has acquired the 237-room W Hotel at 45 Ivan Allen Jr. Boulevard Northwest for a little under $25 million and less than half of what Ashford paid for the property eight years ago, the Atlanta Business Chronicle reported.
It was acquired via deed-in-lieu of foreclosure and is Stonebridge’s first acquisition in Georgia.
The W Hotel is one of 19 hotels that Ashford said it planned to surrender to lenders in July. By handing the keys back, Ashford will save about $255 million, which was the payment needed to extend three CMBS loans secured by the 19 hotels. Morgan Stanley Bank, Bank of America and Barclays Bank were the lenders.
Five of Ashford’s troubled hotels, including the W Hotel, were acquired by Stonebridge last week, the outlet reported.
The others were Embassy Suites in Flagstaff, Arizona; Marriott Research Triangle Park in Durham, North Carolina; Embassy Suites in Walnut Creek, California; and Marriott in Bridgewater, New Jersey.
The Atlanta deal reflects a broader real estate trend in which landlords are grappling with high interest rates and a tough lending environment. As refinancing assets becomes increasingly difficult, many commercial property owners have been forced to sell their holdings at a loss or surrender them to lenders.
The W Hotel in Atlanta, completed in 2009, in the Great Recession’s aftermath, faced foreclosure in 2010. Ashford purchased the property for a little under $57 million in 2015.
Ashford, which owns 100 hotels nationwide, was recently sued by lenders after defaulting on nearly $150 million in loans this past summer.
— Quinn Donoghue