Bloomberg News

Hyatt Aviara’s $186.5 Million Loan Sent to Servicer, Fitch Says

April 17, 2013

About $186.5 million in debt backed by the Park Hyatt Aviara Resort, a former Four Seasons property in Southern California, was sent to a special servicer today, Fitch Ratings said.

The debt was sent to CWCapital Asset Management LLC because the borrower is 60 days past due on payments, Mary MacNeill, managing director at Fitch Ratings, said in an e-mail. The 329- room property, about 35 miles (56 kilometers) north of San Diego in Carlsbad, is owned by Broadreach Capital Partners and Maritz, Wolff & Co., according to Fitch. Special servicers negotiate with landlords on behalf of investors in commercial mortgage- backed securities.

The loan backed by the high-end hotel -- which features an 18-hole golf course designed by Arnold Palmer, two outdoor swimming pools and a spa -- went into default in September 2010 after cash flow dried up, according to Morningstar Inc. (MORN:US)’s Structured Credit Ratings unit. In January 2011, the owners negotiated an extension to Feb. 11, 2017, Heather Turner, then a Broadreach director, said at the time.

The property had an occupancy rate of about 54 percent for the 12 months ended February 2012 and average nightly rates of $242.70, according to Fitch. That compares with an occupancy of 70 percent and average room rates of $364.87 when the debt was issued in early 2007, Fitch said. Rooms started at $295 for the week of April 22, according to the hotel’s website.

The property’s owners replaced Four Seasons with Hyatt as manager of the hotel in June 2010, Fitch said.

Lew Wolff, chairman of Maritz, Wolff & Co., and Kenneth Reinke, chief financial officer at Broadreach, both declined today to comment on the debt.

To contact the reporter on this story: Nadja Brandt in Los Angeles at nbrandt@bloomberg.net

To contact the editor responsible for this story: Kara Wetzel at kwetzel@bloomberg.net


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