Famous Claremont Hotel files for Bankruptcy

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The Claremont Hotel Club & Spa, the stage for many world class performances in the past from artistes like Louis Armstrong and Count Basie, has filed for bankruptcy protection. Over the past century, the hotel has been a symbol of luxury and opulence in the San Francisco Bay area. It was acquired by Morgan Stanley in 2007 and along with 4 other high-class hotels. Other hotels included the Grand Wailea Resort in Hawaii and the Club at PGA West in Southern California.

The Claremont was once a residential hotel but today is marketed more as a resort and spa. It is considered high-end with rooms above $400 a night, which is beyond the reach of budget travelers. The hotel along with others was sold to Morgan Stanley for $6.6 billion four years ago in an effort to increase the Wall Street firm’s real estate holdings. Together, the five resorts have 14 golf courses, more than 35 F&B outlets and more than 432,000 square feet of meeting space. But the acquisition took place when the tourism industry was still strong and luxury properties were at record high prices. However, when the recession hit, all that changed and when a debt of $1.5 billion fell due last week, the properties had to be foreclosed.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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