Thread: One In Five US Hotels May Default

Hotel Loan Defaults Double as Recession Cuts Travel (Update2)

By Dan Levy and Nadja Brandt

July 1 (Bloomberg) -- As many as one in five U.S. hotel loans may default through 2010 as the recession means companies are spending less on travel and perks, according to University of California economist Kenneth Rosen.

The value of hotel properties in default or foreclosure almost doubled to $17.3 billion in the second quarter through June 24 from $9 billion at the end of the first quarter, data compiled by Real Capital Analytics Inc. show. The New York-based research firm, which began tracking distressed commercial property in November, expects hotel defaults to increase by as much as $2 billion this quarter, said analyst Jessica Ruderman.

“Hotels without question will have the highest foreclosure rate of any commercial real estate sector,â€

I was just recently looking at income properties listed for sale in the Colorado Springs area and was surprised to see a hotel, I forget which chain it is but it's one of the biggies, for sale.

And it was listed as a vacant property.

From the looks of the pic which was with the listing, it didn't even seem like they had done much with it except for the building.......didn't appear like the landscaping had been done, and it definitely lacked that finished, welcoming appearance......it more had that stark, pre-opening sort of appearance to it.

I'd imagine we'll be seeing more and more of that.