CMBS Hotel Portfolio Transferred to Special Servicing
The loan was previously transferred into special servicing in April 2020 but the sponsors negotiated extensions
By Brian Pascus September 17, 2024 3:44 pm
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A $409 million commercial mortgage-backed securities (CMBS) loan secured by a portfolio of 17 hotel properties across seven states has been sent to special servicing due to an imminent maturity default, according to an alert from Morningstar Credit.
The CMBS loan — which comprises the MSC 2017-ASHF single-asset, single borrower deal — was transferred to special servicing on Aug. 30. The loan had previously been transferred to special servicing during the height of COVID-19 in April 2020, but the sponsors were able to execute a loan modification agreement in February 2021. Today the loan faces down a 12-month extension option that matures in November 2024, according to Morningstar.
Morningstar reported that 2023 net cash flow for the portfolio was 14 percent less than its underwritten projections, while average occupancy across the 17 hotels has hovered from 67 percent in 2022 to 71 percent in 2023.
The 17 hotels fall under either the Courtyard, Embassy Suites, Hampton Inn, Hilton, Residence Inn or Sheraton brands. Properties within the portfolio include Courtyard Crystal City Arlington in Arlington, Va.; Embassy Suites Dallas Galleria in Dallas; Hilton Garden Inn Jacksonville in Jacksonville, Fla.; Residence Inn San Diego Sorrento Mesa in San Diego; and Sheraton City Center Indianapolis in Indianapolis, Ind.
Brian Pascus can be reached at bpascus@commercialobserver.com
