OAKLAND — A lender has taken ownership of Oakland’s biggest hotel through a foreclosure that underscores the ailments and price nosedives that plague the Bay Area’s sickly lodging market.
The Oakland Marriott City Center hotel was taken back by its lender, which bought the property for just under $70.2 million through the foreclosure. Default Resolution Network, which handled the foreclosure proceeding, provided the results of the transaction.
Invesco CMI Investments filed the default against the hotel. Invesco CMI bought the loan in May 2024 from the original lender, Nataxis New York Branch, according to documents on file with the Alameda County Recorder’s Office.
The loan that was foreclosed totaled $100 million, county documents show.
The 500-room lodging tower, which has a choice location at 1001 Broadway next to the city’s convention center, is Oakland’s largest hotel.
Numerous other hotels in the Bay Area have encountered loan defaults, foreclosures, and a plunge in their value as the region’s lodging sector struggles to convalesce from its coronavirus-linked economic maladies.
The $70.2 million price that the lender placed on the hotel through the foreclosure suggests a deep discount from the property’s prior values.
In 2017, the hotel was worth $143 million, based on the price that an affiliate of Hong Kong-based Gaw Capital paid to buy the downtown Oakland lodging tower.
This means the hotel’s latest value represents a 50.9% price decline from its prior value. Put another way, the hotel’s value has been sliced in half.
Plus, the current value of the hotel is about 30% less than the $100 million loan amount.
The hotel’s value, based on the foreclosure, is also 49.1% below the current assessed value of $138 million.
A slump in property values can throttle revenue for an array of public agencies.
If real estate values turn soft in a region, the decline could impede a crucial revenue stream for cities, counties, regional agencies, and school districts.