MENLO PARK — An upscale hotel next to downtown Menlo Park has toppled into default on its mortgage, fresh evidence of the challenges facing the embattled lodging sector in the Bay Area.
Park James, a small boutique hotel in Menlo Park, has been threatened with seizure by its lender because the loan payments for the property are delinquent, according to documents filed in San Mateo County.
The hotel has 61 rooms, was constructed in 2017, and opened in 2018 by its developer and principal owner, a Bay Area group, according to county and state business records.
Park James appeals primarily to an upscale clientele that is visiting Silicon Valley, typically on a business trip.
The property has defaulted on a loan issued in 2019 by Employees Retirement Plan of Consolidated Electrical Distributors Inc., San Mateo County documents show.
The financing totaled $32 million, according to the property records.
The ownership entity that defaulted on the property loan is an affiliate whose managers are Bay Area business executives James Pollock and Jeffrey Pollock, county and state documents show.
James Pollock is the chief executive officer and Jeffrey Pollock is a vice president with Portola Valley-based Pollock Financial Group.
The coronavirus has afflicted the lodging industry with mounting economic ailments. During 2020, hotels and restaurants shed 127,400 jobs, leaving that sector with 33.6% fewer jobs in the nine-county region compared with 2019.
The Bay Area’s lodging and dining industries have been hammered even harder than what happened statewide last year. California hotels and restaurants lost 499,600 jobs in 2020, a 29.1% drop from the totals for that sector at the end of 2019.
When the Park James hotel opened in 2018, it received rave reviews from guests and professional observers alike.
“The 61-room boutique property has a lot going for it, introducing a ton of unexpected amenities meant to impress its tech-savvy clientele, all of whom will likely be staying on business,” the Robb Report wrote in late 2018.
Park James is located a short distance from the headquarters of social network titan Facebook and is fairly close to the headquarters of search giant Google.
The hotel features a dining facility called Oak + Violet Restaurant and in-room iPads.
“When taken together, it all adds up to a place that, though business-focused, is undeniably cool,” the Robb Report stated.