WASHINGTON, DC-The foreclosure auction scheduled for DC’s St. Regis hotel did not occur on Friday. As GlobeSt.com earlier reported, there were rumors that the lender, Barclays Capital, would not begin foreclosure proceedings on the hotel, despite news reports to the contrary. Barclays Capital declined to comment to GlobeSt.com for this article.
A source confirms for GlobeSt.com that the auction did not take place--and that the reason was due to paperwork or similar issues. In other words, it was not pulled because the lender and borrower were negotiating a workout to forestall the foreclosure, as reported in the Irish Times.
“No one is going to argue that the inevitable [foreclosure auction] won’t occur,” the source says. “It is just a matter of time.” In this particular case, the borrower acquired the property at the height of the market and is too encumbered with debt to make it worthwhile for the lender to negotiate a deal. Claret Capital, a private equity firm in Ireland, purchased the hotel at the height of the market in 2007 for $170 million. There is a $101.6-million note on the property.
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