Inns and Outs

Sound familiar? The note is $40 million. The bidding opens at $25 million. Bidders listen to the auctioneer drone, repeating the $25 million minimum bid price.

No one budges. So it goes for the notorious Watergate Hotel in Washington, DC. The Washington Post reports:

Ultimately, in 2007, Monument Realty decided to close the Watergate for an 18-month, $170 million renovation. At the time, Darby said the landmark would be developed into a premier hotel, with plans for $2,000-a-night suites.

The hotel liquidated everything – beds, Greek-style columns, silver teapots, toilets and more – to prepare for the renovation. But frozen credit markets scuttled plans for the multimillion dollar refurbishment, and Monument Realty defaulted on the loan from PB Capital.

PB Capital’s got it back now, and says it’ll find a buyer.

CNBC’s Diane Olick broadened her coverage of the Watergate Waterloo with some analysis of the commercial real estate meltdown.

Reasons for growing sentiment about the odds of a double dip boil down to a four-letter word, CMBS.
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July 21, 2009 | Filed Under Financial Crisis 

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