Hotel Foreclosures Rise In California

More than 300 hotels in California were in foreclosure or default as of Sept. 30.

Tourism is way down in the state. Unemployment is way up.

Many hotels on the brink are fighting to stay up.

The worst is yet to come.

There's no recovery in sight.

There's almost no lending for commercial real estate development.

THE LAT REPORTS:

In Southern California alone, there were at least 140 hotels in default or foreclosure in September, including 55 hotels in the Inland Empire, 33 in Los Angeles County and 30 in San Diego County, according to the report by Atlas Hospitality Group. Statewide, 260 hotels were in default on their loans and 47 had been taken over by their lenders in foreclosure, the Atlas report said.

The industry's woes are compounded by the sour commercial real estate market, which has left many resort operators owing more than their properties are worth. Even as they struggle to make payroll, scores of resorts and inns have given up on paying their mortgages, fueling the skyrocketing level of defaults.