Troubled-debt Team Assumes Control of Philly Hotel Loan as Coronavirus Takes Severe Toll on Visits to City


Source: Advisor News
April 16, 2020

Apr. 16–A mortgage backed by hotels, including the former Courtyard Philadelphia Downtown in a historic building near City Hall, has been assigned to a business that manages troubled commercial mortgages as the loan approaches its end date during a rough period for the hospitality industry.

The loan backed by the 21 N. Juniper St. hotel, now known as the Notary Hotel, and three other properties was sent last week to a “special servicer” team at Wells Fargo & Co. ahead of the debt’s June 2020 maturity, Wells spokesperson James Baum said in an email Wednesday.

A loan’s maturity marks the date by which it must be repaid, refinanced, modified or extended to avoid default. This loan has “conditional extension options available,” said Baum, who declined to share other details, citing confidentiality agreements.

“Hoteliers have a limited ability to work directly with holders and servicers of CMBS debt to achieve meaningful relief during this crisis,” the leaders of the AHLA and the Asian American Hotel Owners Association wrote last month in a letter to federal financial agencies. “It is critical that regulators act swiftly to ensure the over $300 billion worth of CMBS debt backed by hotel and lodging assets remains in good standing.”

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