The Line DC Hotel Placed on Auction Block by Acore Capital

Only seven years after opening, a hotel that generated plenty of buzz in Washington, D.C.’s Adams Morgan neighborhood is headed to the auction block.

Acore Capital brought in JLL to market The Line DC at 1770 Euclid Street NW ahead of a public auction on Jan. 23, Bisnow reported. While the 220-room hotel is in the nation’s capital, the auction is set to take place in front of a New York City courthouse.

The developers of the property scored an $80 million loan from Deutsche Bank in 2016, which they refinanced with Acore’s $86 million loan in 2019. That’s where ownership ran into trouble, leading to the foreclosure action and upcoming auction.

A team including the Sydell Group, Foxhall Partners and Friedman Capital redeveloped the site, the former First Christ of Scientist Church. Square Mile Capital, since folded into Affinius Capital, was an investor in the project.

The listed owner in JLL’s notice of public auction is a limited liability company tied to USAA, which is Affinius’ parent company. Affinius was among the parties that did not immediately respond to Bisnow’s requests for comment.

A former managing partner at Foxhall, Matt Wexler, said in a statement that the financial performance of the hotel failed to meet expectations. Wexler also referred to the hotel as a “textbook example of grand ambition coupled with overimprovement, guided by a flawed partnership that was led by brand builders and not investors.”

The hotel is arguably better known as a place to dine than as a place to lay one’s head. James Beard Award winner Spike Gjerde ran a restaurant that closed in 2020, while other restaurant concepts appeared in local and national lists. Forbes called the hotel the capital’s “hippest” in 2021.

Elsewhere in the D.C. hospitality scene, CGI Merchant Group lost the leasing rights to the Waldorf Astoria Washington DC in a foreclosure action, two years after the firm paid the Trump family firm $375 million for those rights.

— Holden Walter-Warner