Ashford’s lenders sue over seven distressed hotels

Dallas-based REIT controlled by Monty Bennett defaulted on loans of $150M in July

Ashford’s Lenders Sue for Control of Seven Distressed Hotels
Ashford Hospitality Trust’s Monty Bennett with 6840 Dallas Parkway and 5001 Whitestone Lane (Ashford Hospitality Trust, Google Maps, Getty)

Lenders have sued a Dallas-based hotel owner, seeking a special servicer for seven distressed hotels.

Ashford Hospitality Trust defaulted on nearly $150 million in loans this past summer, and lenders are requesting the court to appoint a receiver to recover the hotels that back them, including two in Dallas-Fort Worth, according to the lawsuit.

The real estate investment trust, whose founder and chairman is Texas real estate mogul Monty Bennett, said in July it plans to return 19 hotels to commercial-mortgage-backed-securities lenders after the properties failed to meet required debt yield tests. Ashford also owns 15 additional CMBS-secured properties that failed debt yield tests, but it opted to extend $129 million in loans on those hotels. 

For the seven hotels named in the lawsuit, Morgan Stanley lent nearly $90 million; Barclays and Bank of America lent almost $30 million each. The debt was transferred to a securitization trust, which brought he lawsuit, dated Nov. 12, before the New York Southern District Court. 

Two of the hotels are in Plano: the 152-room Courtyard Dallas Plano in Legacy Park at 6840 Dallas Parkway, and the 126-room Residence Inn Dallas Plano/Legacy at 5001 Whitestone Lane. 

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The others are: 

  • Courtyard by Marriott Silicon Valley at 34905 Newark Boulevard in Newark, California
  • Courtyard by Marriott Oakland at 350 Hegenberger Road in Oakland, Calfironia
  • TownePlace Suites Los Angeles LAX/Manhattan Beach at 14400 Aviation Boulevard in Hawthorne, California
  • SpringHill Suites by Marriott Baltimore at 899 Elkridge Landing Road in Linthicum Heights, Maryland
  • Courtyard Inn by Marriott Basking Ridge at 595 Martinsville Road in Basking Ridge, New Jersey

The Ashford group oversees nearly $4 billion in assets. Bennett was dubbed “the face of corporate greed” by the Dallas Morning News in 2020, after his companies received at least $69 million in forgivable loans from the federal government’s Covid-era Paycheck Protection Program. That made Bennett’s companies the country’s largest beneficiary of PPP grants. Ashford later returned the money because of the vagueness of some of the retroactive guidelines. 

Correction: An earlier version of this story misidentified the lenders and mischaracterized the reason Ashford returned Paycheck Protection Program grants.

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