Park Hotels & Resorts to shutter Hilton near Oakland’s airport

363-room business property hurt by crime, analysts say, and will close Aug. 28

Park Hotels & Resorts to Shut Hilton Near Oakland Airport
Park Hotels & Resorts CEO Thomas Baltimore Jr. and the Hilton Oakland Airport Hotel at 1 Hegenberger Road in Oakland (Hilton Hotels & Resorts, Park Hotels & Resorts)

Park Hotels & Resorts will shutter a 56-year-old Hilton hotel next to Oakland’s airport following closures of numerous local restaurants because of crime.

The Virginia-based real estate investment trust announced it would close the Hilton Oakland Airport Hotel at 1 Hegenberger Road , the San Jose Mercury News reported.

The 363-room business hotel, which opened in 1968 next to what is now the San Francisco Bay Oakland International Airport, will close on Aug. 28.

The Hegenberger thoroughfare near Interstate 880 is among the most crime-plagued areas of the city, according to the San Francisco Chronicle, which first reported the closure.

Between 2019 and last year, four local businesses, the Chevron and Shell gas stations, a now-closed Black Bear Diner and a building that houses a Wingstop and a Subway sandwich shop had 2,773 reported crimes.

The nearby In-N-Out Burger closed its doors a few months ago because of crime. Denny’s and Black Bear Diner have been boarded up.

During a news conference outside the Hilton in March, Oakland Mayor Sheng Thao and other city leaders said they had beefed up police patrols and security along the corridor and said it was getting safer, according to the Chronicle.

Sign Up for the undefined Newsletter

Hilton Oakland Airport Hotel, set on 19 acres owned by the Port of Oakland, has a pool, fitness center, meeting rooms, cafe and sports bar, and for decades has catered to business travelers.

Rooms start at $170 a night, according to its website.

A struggling hotel market in the Bay Area affects mostly those catering to business travelers and not located in resort areas, according to the Mercury News. In addition, the number of business conventions has dropped.

“There are still a lot of problems with the hotel market in the Bay Area,” Alan Reay, president of Newport Beach-based Atlas Hospitality Group, which tracks the California lodging market, told the Mercury News. “The cost of operating big full-service hotels that are business-oriented seems to outweigh the income they can generate.”

Oakland and San Francisco have issues with crime and homelessness that make those cities less desirable to visitors and business travelers, Reay said. “You have problems with crime on Hegenberger Road in Oakland and you have problems with crime and homelessness in San Francisco.” 

Last summer, Park Hotels & Resorts defaulted on a $725 million loan tied to its 1,024-room Parc 55 and 1,921-room Hilton San Francisco Union Square, in San Francisco. In October, a receiver took control of both hotels, with plans to sell them in less than a year.

— Dana Bartholomew

Read more

Park Hotels' Thomas Baltimore, Hilton San Francisco Union Square (left) and Parc 55 (right)
San Francisco
SF’s biggest hotels to stop mortgage payments 
Park Hotels & Resorts to likely lose two large SF hotels after not paying $725M loan
San Francisco
Park Hotels & Resorts could lose SF hotels after not paying $725M loan
Receiver to Take Control of Two San Francisco Hotels
San Francisco
Receiver to take reins at SF’s Parc 55 and Hilton Union Square hotels
Recommended For You