The resort, which will continue to operate under its current name, is an indicator of the troubles in the high-end hotel market.
By Roger Vincent and E. Scott Reckard
L.A. Times
July 21, 2009
The seizure of the St. Regis Monarch Beach, where American International Group Inc. sponsored a luxury retreat just days after accepting a federal bailout, is the most dramatic sign yet of the deep troubles in the market for high-end hotels.
Citigroup Inc. took over the Dana Point hotel and golf course Monday after months of negotiations over a $70-million loan that was in default. A foreclosure auction slated for today was canceled after the lender realized there would be no serious bids for the property, according to a knowledgeable person who was not authorized to discuss the situation publicly and spoke on condition of anonymity.
The takeover comes at a time of severe contraction in the hospitality industry.
Resorts such as the St. Regis, which cater to wealthy travelers and the high-end corporate retreat business, are experiencing some of the steepest declines in revenue as the recession hammers demand for business and leisure travel.
As twilight fell one night last week, a single person lounged by the resort’s main pool while only a few couples sat in the restaurants and a piano player performed for an empty lounge. A person knowledgeable about the resort and the negotiations with Citigroup said that only about 15% of the hotel’s rooms had been rented this summer.
Click here to read the whole story at the L.A. TImes
http://www.latimes.com/business/la-fi-stregis-foreclose21-2009jul21,1,4070255.story
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