J
ust in time for Halloween, JLL is selling a $78.4 million debt tied to Hotel Union Square, a notorious "most haunted" hotel in San Francisco's Union Square. The sale of the non-performing loan on an unnamed hospitality property was not confirmed by JLL's Capital Markets team. However, details from the offering suggest it's likely related to the recently closed 114 Powell Street hotel, which matches the loan amount, room count, vintage, and operational status.

    The six-story, 53,000-square-foot hotel was purchased in May 2015 for $109 million by a partnership of Rockpoint and Highgate Hotels. The owner, 100-120 Powell LP, has the same Dallas address as Rockpoint, a real estate private equity firm with $14 billion in assets under management. United Overseas Bank Limited originated a $122.5 million loan in May 2015 for two hotels, including Hotel Union Square and Hotel Diva.

    Hotel Diva shut its doors in December 2020 and was sold to the city using Project Homekey funds in 2021. Highgate Hotels, the other co-owner of Hotel Union Square, missed a balloon payment on the Hyatt Regency Downtown SOMA earlier this year and walked away from the $108 million debt on the Stanford Court Hotel last year.

    The original loan covered both hotels but was intended to be syndicated and never took place after the sale of Hotel Diva. The borrower repaid over $44 million to pay off that hotel's debt, leaving a maturity date extension for the remaining loan on Hotel Union Square until May 11, 2023. The loan went into default in June with $78.4 million in unpaid principal balance and nearly $5 million in missed interest payments and fees.

    JLL also listed the $73.9 million non-performing loan of the Four Seasons Embarcadero earlier this year, which is now in contract. Hotel Union Square made headlines for suing the city over damages caused while it was used as a shelter during the pandemic, receiving $5.36 million out of a planned $26 million payout. The hotel has long been known for its ghostly reports, particularly in Room 207, where Dashiell Hammett allegedly stayed with Lillian Hellman.