NEWARK — A loan delinquency has jolted a big East Bay hotel, a mortgage default that serves up fresh evidence of the feeble state of the Bay Area lodging market.
A Hyatt Place hotel in Newark is in default on its loan and faces foreclosure if the property’s owner is unable to pay off the loan in full, according to documents filed on June 9 with the Alameda County Recorder’s Office.
The loan default that has hit the Hyatt Place Newark/Silicon Valley hotel shows maladies still afflict the Bay Area lodging market in the wake of the economic disruptions that the coronavirus outbreak unleashed.
Loan defaults, foreclosures and a plunge in property values have begun to haunt a growing number of hotels in the Bay Area.
In 2019, State Bank of Texas provided the owner of the Hyatt Place hotel with an $18 million loan to finance the property, which is at 5600 John Muir Drive in Newark, the county real estate records show.
Shivam Real Estate owns the hotel property whose loan is now in default, according to the county property documents.
Fremont residents Nimish Patel and Dipika Patel are among the principal executives and members of Shivam Real Estate, state business records show.
In Oakland, the Courtyard Oakland Downtown was bought for $10.6 million in October 2024. That was one-fourth of the $43.8 million that the seller paid in 2016.
Oakland’s largest hotel, the 500-room Oakland Marriott City Center at 1001 Broadway, went into default in February due to a delinquent $100 million loan. A foreclosure now looms over the hotel.
A lender foreclosed on San Jose’s largest hotel, the Signia by Hilton, in May. The foreclosure proceeding valued the downtown hotel at $81 million.
An 18-story, dual-brand hotel tower at 1431 Jefferson St. in downtown Oakland was taken back by its lender through a deed in lieu of foreclosure filing that stated the unpaid debt on that hotel was $117 million.
Park Hotels & Resorts has ceased making payments on a $725 million loan that had two major San Francisco hotels as collateral: the 1,921-room Hilton San Francisco Union Square and the 1,024-room Parc 55 San Francisco.
In 2023, the historic 135-room Huntington Hotel atop San Francisco’s Nob Hill was bought through a foreclosure whereby the new owner paid about $29.3 million — a price that was 67% below the hotel’s assessed value of $87.6 million at the time of the purchase.
Two East Bay hotels have filed for bankruptcy after facing separate foreclosure proceedings. The 102-unit Super 8 by Wyndham hotel in Livermore is in default on a $7.7 million loan, and the University Inn & Suites, a 113-unit Berkeley hotel, has defaulted on a $10.5 million loan.
A 204-room hotel complex in San Jose consisting of a Motel 6 and a Super 8 hotel is in default on a $21.7 million loan.
“A lot of the hotel markets that are primarily business-oriented, such as San Francisco, Oakland and San Jose, are struggling the most,” Alan Reay, president of Atlas Hospitality Group, said in a previous interview with this news organization.
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