Bankrupt 5th Avenue Partners LLC, Owners of the Sè San Diego Hotel
Along with Adjacent Building Housing the House of Blues,
Could be Put up for Sale
Estimates Claim Could go for $50 million, Significantly Less than the $150 million Development Cost
By Lori Weisberg, The San Diego Union-Tribune
January 7, 2011
The financially troubled owner of the tony Sè San Diego hotel, dogged by controversy since before it opened two years ago, wants to put the downtown high rise up for sale.
The upscale boutique hotel, along with an adjacent building in which the House of Blues is located, could fetch up to $50 million, according to one Southern California broker, although that is significantly less than the $150 million cost to develop the high-profile project
The owner, 5th Avenue Partners LLC, which filed for bankruptcy protection last June, is awaiting court approval to hire the brokerage firm, CB Richard Ellis, to handle the sale. However, it must first overcome objections raised by creditors who argued in a court filing this week that they had not been properly consulted on the sale process, which they say should occur as part of a bankruptcy reorganization plan.
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The Sè San Diego hotel opened in December 2008 in the middle of a souring economy that ultimately forced the developer into bankruptcy.
| In the meantime, 5th Avenue Partners remains hopeful that they can start marketing the Sè for sale this month.
“We feel (the creditors’ objection) is meritless on so many levels,” said attorney Marc Winthrop, who represents 5th Avenue Partners. “They’re feeling petulant they were left out of the decision. This property is worth far less than the amount of debt against it, so the proceeds from a sale could be paid to the lender, and there’d be no money left over, so what kind of reorganization plan could you do?”
Opposing attorney Ali M.M. Mojdehi pointed out that a suit aleady has been filed against the hotel lender on behalf of the creditors committee and many of the construction companies that worked on the Sè to establish priority over the bank once available funds are distributed.
“The debtor has sold out to the bank,” said Mojdehi, who represents the creditors committee. “We are not for sale and intend to push fror a sale process fair to all creditors, not just the bank.”
For the rest of the story including detailed property information please visit:
http://www.signonsandiego.com/news/2011/jan/05/bankrupt-downtown-hotel-may-be-put-up-for-sale/
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Contact:
Lori Weisberg, Staff Writer
San Diego Union-Tribune
350 Camino de la Reina
San Diego, CA 92102
619-293-2251
lori.weisberg@uniontrib.com
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