Miami-based funding agency CGI Service provider Group bought the posh lodge in 2022 for $375 million with a $285 million mortgage from BDT & MSD Companions. By 2023, the agency had defaulted on its debt.
Inman Join is shifting from Las Vegas to San Diego in 2025 and it’ll be larger, higher, and bolder than ever earlier than. Be a part of us for Inman Join San Diego on July 30-Aug. 1, 2025 with the brightest minds in actual property to form the way forward for the trade. Reserve your spot at present for an unique low cost.
Because the industrial actual property market nears its backside, one other notable property has succumbed to foreclosures: the Washington, D.C., lodge previously owned by Donald Trump’s household agency.
Miami-based funding agency CGI Service provider Group bought the posh lodge in 2022 for $375 million. By 2023, the agency defaulted on its debt, in accordance with BDT & MSD Companions, the financial institution that first made CGI a $285 million mortgage with which the agency bought the property. BDT & MSD then prolonged the foreclosures by public sale date for 45 days, however CGI was unable to treatment the default.
On Monday, the financial institution took over the lodge in a foreclosures public sale, The Wall Avenue Journal reported. The property has been working because the Waldorf Astoria Washington D.C. since 2022.
“We have actively engaged with CGI in a constructive manner, allowing ample time for them to explore financing and alternative options,” a spokesperson for BDT & MSD advised The WSJ. “We have now taken control of the Waldorf Astoria Washington D.C. via foreclosure.”
CGI, which has partnered with former Main League Baseball participant Alex Rodriguez on lodge investments, stated it’s hoping to recoup the property’s long-term lease.
“We are not done fighting for the Waldorf Astoria,” a spokesperson for CGI advised The WSJ. “Even though the auction has occurred, we remain in intense discussions with BDT & MSD Partners and still have a finalized capital solution on the table to cure the loan default and recapitalize the asset.”
BDT & MSD stated it might be retaining rights to the property. Hilton owns the Waldorf model and can proceed to function the lodge.
The lodge is housed within the Outdated Put up Workplace constructing on Pennsylvania Avenue, not removed from the White Home. The Trumps by no means owned the lodge, however leased it from the federal authorities. The household outbid plenty of different big-name hoteliers, together with Marriott Worldwide and Hilton, to safe a long-term lease.
Whereas Trump was president, the lodge grew to become a well-liked assembly place amongst Republicans, together with lobbyists and lawmakers.
Enterprise has reportedly been good on the lodge this yr, however CGI has nonetheless been hit arduous by increased rates of interest, like many industrial properties throughout the nation.
Portfolios of foreclosed and seized industrial properties hit $20.5 billion in the course of the second quarter of 2024, in accordance with MSCI Capital Traits. The most recent foreclosures figures recommend that the industrial market could also be close to its backside, in accordance with economists.
Regardless of the Waldorf Astoria’s foreclosures public sale, Hilton stated that the lodge will proceed to function.
“Hilton has a long-term agreement to manage the hotel, and that agreement will continue,” a Hilton spokesperson advised The WSJ. “It remains business as usual at the Waldorf Astoria Washington D.C.”
Get Inman’s Luxurious Lens Publication delivered proper to your inbox. A weekly deep dive into the largest information on the planet of high-end actual property delivered each Friday. Click on right here to subscribe.
