The Mansion on Peachtree's Rosewood Hotel, one of Atlanta's toniest lodgings, will operate as normal despite the financial troubles of the building owner, the hotel's managing director says.
Luigi Romaniello said he met with hotel staff last week to assure them that it would be "business as usual" while the owner of the 42-story Mansion, a mixed-used property of 127 hotel rooms and more than 40 multi-million dollar condos, renegotiates a loan to avoid foreclosure.
Romaniello said Clark Butler, president of Atlanta-based City Centre Properties, the building's owner, told him about the negotiations last week. Romaniello said Butler was giving him a "head's up" about the negotiations before they became public.
"This really speaks to the restructuring of the building's financing, which is natural in today's economy," Romaniello said. "He (Bulter) said it was a discussion about the owners, not us."
Several calls to Butler for comment were not returned.
DataBank, which keeps tabs on real estate transactions in Atlanta, listed loans on the building of $147 million and $40.5 million, held by iStar Financial and First Citizens Bank of Columbia (S.C.) respectively.
Officials from New York-based iStar Financial did not return phone calls. A spokeswoman for First Citizens declined to comment.
The 1.62 acres the building sits on at 3376 Peachtree Road was purchased in 2004 for $10 million. It was constructed by John Williams, one of the city's legendary builders. Williams, an investor in the project, was out of town and could not be reached for comment.
A number of Atlanta's signature buildings have been hit by foreclosures since the collapse of the financial markets in the fall of 2008.
The Equitable building downtown was foreclosed in June. In December, Tower Place 200 in Buckhead was foreclosed and sold. And the Clermont Hotel was foreclosed in 2009 and shutdown New Year's Eve, though its well-known Clermont Lounge remains open.
Mark Woodworth, president of PKF Hospitality Research, said there could be a number of restructurings to keep buildings out of foreclosure in 2010. He said a lot of loans will reset this year, setting off a wave of negotiations between owners and creditors.
"This could be a worse year for a number of these deals," he said.
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