Times Square, New York

July 20, 2017 Comments Off on InterContinental New York Times Square in Special Servicing Views: 1110 New York News, Top New York

InterContinental New York Times Square in Special Servicing

The InterContinental New York Times Square is going to be fine… eventually. Don’t worry that the hotel has been operating at a loss, and a $188 million loan on the property has been sent to “special servicing.”

“We expect that workout negotiations could result in a modification… to afford the borrower time to sell the property,” according to analysis by Morningstar, which values the hotel at $338.4 million, well above the balance of the loan, which reached the end of its term in June 2016.

The troubles at the Intercontinental provides a window on New York’s hotel market, which has been flooded with new supply, though demand remains relatively strong. The average daily rate at the 607-room hotel is down about 8.8% since issuance, though the hotel’s occupancy rate remains in the low 90% range.

“With the balance of securitized commercial mortgages backed by New York City hotels at $3.74 billion as of July, we remain concerned with a projected slowdown in demand for Manhattan hotel rooms as supply grows,” according to Morningstar.

Read More at Morningstar

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