Another nail…

In San Francisco’s coffin…

Another blow is being dealt to downtown San Francisco. The investment firm that owns Hilton San Francisco Union Square and Parc 55 hotels is walking away from its debt and surrendering them to its lender.

Park Hotels & Resorts has opted to cease payments on a $725 million loan, according to a press release.

“The Company intends to work in good faith with the loan’s servicers to determine the most effective path forward, which is expected to result in ultimate removal of these hotels from its portfolio.”

Full article, HERE from ABC7 in San Francisco.

This is damning on multiple levels, as supposedly those two properties are worth over $1.4 BILLION dollars. For them to walk away without even trying to sell them, that indicates (at least to me), that they don’t believe they can even get enough to pay off their loan, much less actually recover enough business to continue to operate in the black.

Union Square was the prime high dollar shopping area in San Francisco, but there were always a ‘few’ problems with its location. It is mere blocks from the Tenderloin District, which has always had a bad reputation in San Francisco. And they number of high end stores that are closing along with the transients/drugs/etc. on top of the lockdown during the pandemic have, at least to my mind, pretty much doomed the city.

And when you throw in the cost of living there, there is no way anybody in the service industry can live anywhere close to town, much less afford to park down there (and hope your car isn’t broken into).

Kiss the place good by and no great loss, as far as I’m concerned…



Another nail… — 22 Comments

  1. Methel Erman sings: “I left my debt in San Franpsycho”

  2. I made the lowest grade ever recorded in Economics at UNC-CH in 1986, which should demonstrate my lack of understanding of economic theory.
    That being said, isn’t this the same thing that is afflicting crypto-currency? Namely, that suddenly, consumers are no longer confident that the item is worth what others say it is?
    And I recently read something about the rationale behind the collapse of the tulip bulb craze in the 17th century being the same thing: no buyers at inflated prices lead to no buyers at ANY price.
    I wonder if it’s going to get to the housing market? It’s ludicrous, what ANY housing is going for in my area, north of Atlanta.

  3. The same thing is going to happen to other democrat controlled cities across America unless the residents wake up and toss them out of office and get some sensible people to replace them.

    • “Wake up & toss them from office” won’t happen as long as the Dominion voting software, ballot harvesting, voter fraud, 2000 mules, etc continues to happen. The only thing that will happen is what the swamp allows to happen.

  4. Those two places combined probably employ a good number of people, too. But not for long.

  5. The banks holding 1.4 Billion dollars worth of (now) bad loans are going to have a hard time selling those properties at anywhere near the loan value. I wonder if that’ll cause another failure or 2.

  6. I feel for the pain this will cause a lot of people but my far from admirable side is enjoying the comeuppance the smug elites attitude Frisco residents always struck me as having.

  7. There’s a big push to “Return to Office” even for jobs that can be done 100% online remotely, and beneath the veneer of “it’s good for collaboration,” and “preservation of office culture,” the real reason is the decline is ancillary revenue from all the office workers eating out for lunch and doing a bit of shopping before returning home. Worse in open-air asylum cities like SF, Seattle, and Portland, but central city commercial property valuations have taken a substantial hit, and the big lenders are leaning on the big office tenants to drag their employees back into the cities.

  8. So Sad – I remember San Francisco as a beautiful place to visit when I was last there about 25-30 years ago…

    Now I wouldn’t even go there in order to just make the drive down Highway 1 which I wanted to do one last time

    • +1 Not much of a city person but in that time frame, San Fran was one of the few cities I enjoyed. Montreal was the other.

  9. What do you bet that SanFran will ‘seize’ under eminent domain or some other bullscat the two hotels, turn them over to the homeless and in 3 months one of them will have burned down while the other will be condemned due to all utilities being destroyed within the facility?

    In my city, the local projects burnt down and the city moved the residents ‘temporarily’ into a hotel. Within 6 months the hotel was condemned and it took another 6 months to move the last of the residents out.

    I see the same thing happening in a huge SanFran way with these two properties.

    • They’d make excellent homeless shelters, or shelter for the newly arrived foreign guests (was wetbacks), paid for by tax dollars. They’d instantly turn into high-rise slums/projects. The City needs to be walled off.

      It was a fun place once. Fine dining, first-class accommodations, but I have no desire to return for any reason.

  10. Meh, just another symbol of the acceleration of the downfall. I wish it would go faster so we could begin to rebuild it.

  11. Thirty years ago, the only two reasons that got me into SF was visiting a couple of good Banana Republic stores as their new parent company, Gap, turned the chain into a self-clone, and skating in the Golden Gate Park area on Sundays. The early 90’s seemed to be when that town really hit the skids in general. It got noticeably more dangerous to walk around as a non-resident, so my money stayed away, as I followed the rules about “going to stupid places… etc”.

  12. All- Thanks for the comments, Beans you ‘may’ be right… ‘Slick’ Newsome is getting desperate for somewhere to put the illegals…

  13. San Francisco, as a geographic location, is beautiful.
    It’s the current management and citizenry that are atrocious.

    This sort of thing is the reason we invented the neutron bomb in the 1970s.

  14. Aesop- That it is, and COLD thanks to the bay… It was routinely in the 60s-70s up there while we sweltered at Moffett in 90’s-100s…

    • Once I got a heated vest, that was always carried on the bike, even in the summer. Riding up 280 to the City could have you freezing in the middle of the daytime, when it was t-shirt weather in the south bay.
      A 2-stroke rider I talked to up at Alice’s Restaurant told me that his bike had seized one day when he dropped into one of the valleys in that area, and the huge temperature drop was too much for his freshly built motor to handle. Had to sit on the shoulder for a few minutes before it unstuck.

  15. My Grandmother and HER mother spent good times in “Frisco” back in the late ’20s. (YIPE! Almost hundred years ago!!) Grandma would go back for visits as late as the 1970s.
    Dad LOVED his TDY’s there.
    Mom LOVED shopping, eating, and parting there.
    I’m sorry I never got a chance to visit the place.

  16. Borders closed its Union Square store back when I stilled lived across the bay in Emeryville. That was a long time ago but I saw the handwriting on the wall and moved to Solana Beach.