Gaw’s Standard High Line Hotel escapes $170M foreclosure
Four-star establishment missed loan payments during pandemic
An iconic hotel above the High Line has avoided the ax.
On Monday, Wells Fargo dropped a two-year-old, $170 million foreclosure suit against Hong Kong-based Gaw Capital Partners’ Standard High Line Hotel at 848 Washington Street.
The bank, acting on behalf of bondholders who own the loan, had on June 1 given Gaw until July to respond to legal filings as the parties negotiated a settlement, according to court documents.
It is unclear, however, how they plan to resolve the loan default.
The 338-key, four-star hotel, which sits on stilts above the popular tourist attraction, was purchased by Gaw in 2017 for $340 million with help from a $170 million acquisition loan from French investment bank Natixis. The loan, which was to be paid off over 10 years, would eventually be split into four promissory notes.
Things went awry when the pandemic shut down the hospitality industry. Gaw missed payments from May 2020 through October 2021, according to a federal lawsuit in which lenders claimed the private equity fund owed them nearly $187 million.
Behind the scenes, Gaw’s Standard High Line was one of 8,100 hotel businesses saved by federal coronavirus assistance, which handed U.S. hotels large sums through the Paycheck Protection Program. At Gaw’s High Line property, that saved 468 jobs.
The company, one of the largest real estate private equity firms in Asia, manages $33.6 billion in assets around the globe, according to Forbes.
Gaw Capital did not respond to a request for comment.
In a statement at the time the lawsuit was filed, a management consultant with Gaw Capital Hospitality disputed that the company had missed payments, asserting that “many” of the alleged missed payments were actually sitting in lender-controlled accounts while the controlling note holder, Apollo Global Management, declined to pursue settlement offers “at market terms.”
Rooms were available Wednesday at The Standard starting at $429, according to booking sites.