When the economy tanks the travel industry is often on the front lines. A high end South Beach hotel in Miami knows all about that problem with creditors moving to foreclose on the property. We get this from a recent Miami Herald article:
The swank South Beach hotel is still open and charging premium rates but last made a mortgage payment in September. A dismal year walloped the financials at the oceanfront property.
Home to a Robert DeNiro restaurant and a long pedigree of celebrity guests, the Shore Club saw profits collapse last year — down 62 percent as it cleared just $328,000 before taxes and debt payments, according to filings by its operator, Morgans Hotel Group. …
Now forced to fend off foreclosure proceedings over a $126 million loan from 2005, the Shore Club probably qualifies as South Florida’s most high-profile hotel drama. Long a source of gossip-column fodder since its 2001 opening, the Shore Club got hit by the recent hotel downturn just as it faced more competition for a shrinking pool of free-spending vacationers.
“A lot of that high-end boutique South Beach product appealed to the Wall Street crowd — the 38-year-old, 39-year-old executive who got six-figure bonuses,” said hotel broker Dan Carlo, of Holliday Fenoglio Fowler in Coral Gables
.
