A big East Bay hotel that’s engulfed in a massive nationwide loan failure has been bought.
Hyatt House Pleasanton, a lodging at 4545 Chabot Avenue in Pleasanton, seen on May 9, 2025.
A big East Bay hotel that’s engulfed in a massive nationwide loan failure has been bought.
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PLEASANTON — A big East Bay hotel that’s engulfed in a massive nationwide loan failure has been bought through a streamlined foreclosure process, offering a gloomy new sign of a fading Bay Area lodging market.
Hyatt House Pleasanton has been bought through a deed in lieu of foreclosure, according to documents filed on April 30 with the Alameda County Recorder’s Office. This sort of deed is a process that enables to buyer to gain ownership of a property in a streamlined manner.
Hotels suffered brutal woes after state and local government agencies ordered wide-ranging business shutdowns to combat the spread of the deadly bug.
The buyer is an affiliate linked to the Texas office of Mount Street U.S., a London-based real estate and finance firm, according to state business records and the Alameda County real estate documents.
The transaction involves one of the properties tied to a $204 million loan that financed 22 hotels coast to coast, according to public documents filed in a federal court in New York City.
The 22 hotels were placed into court-ordered receivership after the coronavirus outbreak walloped the hotel and travel markets worldwide and in the Bay Area.
“The borrowers have insufficient cash flow available to pay the costs and expenses of owning and operating the hotels,” attorney Suzanne Bessette-Smith, a partner in the real estate practice of law firm Barack Ferrazzano Kirschbaum & Nagelberg, stated in a June 2020 letter filed with a U.S. District Court.
Hawaii-based Shidler Group bought the portfolio of hotels in 2017, including the 128-room Hyatt Hotel Pleasanton and a hotel in Pleasant Hill.
Hyatt House Pleasanton was bought for $39.6 million eight years ago by Shindler Group, which also landed $23 million in financing as part of the $204 million overall funding package for the hotel portfolio that’s now in receivership.
Another hotel in the failed portfolio owned by an array of Schindler Group affiliates is Hyatt House Pleasant Hill, a 162-room hotel in Pleasant Hill that received $21 million in funding in 2017.
Wilmington Trust wound up with the loan in 2017 when the original lender, National Select Service Funding, transferred the financing package to the Wilmington investment management firm.
Some anecdotes have emerged that describe the difficulties the 22 hotels in the portfolio were experiencing in 2020, a few months after the coronavirus outbreak occurred earlier that year in March.
The hotels in the portfolio that were managed by HHM Hotels were “cut off from some suppliers” and had “not made a payment in the last 2.5 weeks other than taxes,” according to federal court records.
Some hotels in the portfolio that were managed by Chartwell Hospitality appeared to be operating with no certainty that they could remain open for more than a week or so, court papers show.
“We are back to where we were two weeks ago which is out of funds to keep these hotels open,” a Chartwell Hospitality executive stated, according to court papers.
The hotel managers were also scrambling to obtain funding from the COVID-era Paycheck Protection Program, or PPP.
“There is an incredible amount of stress that is being put on the teams at these hotels while they work incredibly hard to keep the assets open for business,” Chartwell Hospitality stated in an email that was part of the court record.