28 Acres Near Universal Orlando Going on Block

The hotel owners owe Can Partners $26.9 million. The hotel at 5715 W. Major Blvd., one-quarter of a mile from tourist-themed International Drive and 15 minutes from Walt Disney World, has been closed since December. U.S. Bankruptcy Court Judge Karen S. Jennemann paved the way last week for the foreclosure suit by refusing to allow the hotel owners to file for Chapter 11 protection from creditors under the U.S. Bankruptcy Code.

The judge ruled Winter Park, FL-based Universal Partners LLC had no employees; a skeleton maintenance staff; $1,000 in its bank account; and a $220,000 annual business insurance premium payment coming due Feb. 6, all insufficient factors for a realistic reorganization.

This will mark the second foreclosure against the hotel in the last three years. Can Partners became involved with the property by buying a $17.5 million loan on the hotel from Fort Lauderdale, FL-based Bank Atlantic after the bank foreclosed on the asset. Cam Partners Investment IV, another subsidiary of Canyon Capital Realty Advisers LLC, holds a $5.7 million second mortgage on the property.

The last sale price for the property was recorded Jan. 29, 2001 when the hotel's current owners paid $26.88 million or about $36,250 per room, according to Orange County real estate records. In a prior sale, the property went for $26.2 million on Oct. 1, 1995.

The land is far more valuable than the hotel, largely because there is no other comparable dirt immediately nearby, brokers tell GlobeSt.com.

"The lenders are hoping they can recoup all or most of their $26.9 million loan from the sale of the property but that is an unrealistic expectation, given today's sluggish investment and development market," an Orlando industrial broker who has handled similar transactions tells GlobeSt.com, on condition of anonymity.

He estimates the property could go for a maximum $500,000 per acre ($11.48 per sf) or a total $14 million. Orange County Property Appraiser Bill Donegan puts the land's market value at $7.3 million or $292,000 per acre ($6.70 per sf). The hotel's 11 four-story buildings are appraised at $8.97 million.

Court records show the principals in Universal Partners are Foremost Resorts Inc. of Orlando, the managing partner; and Kings VA Ltd and Roberts Orlando LLC, both of Hawaii. Universal Partners is not associated with Universal Orlando's ownership group.