Morgans Hotel Group Provides Update on the Status of Hotel Property in Scottsdale, Arizona (United States)
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Morgans Hotel Group Provides Update on the Status of Hotel Property in Scottsdale, Arizona (United States)
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Category: North America & West Indies / Carribean islands - United States - Industry economy
- Figures / Studies
This is a press release selected by our editorial committee and published online for free on 2009-12-09
Morgans Hotel Group Co. (NASDAQ: MHGC) (“MHG”) today announced that it has not been able to reach an acceptable agreement with its lenders on a restructuring of the loans on its hotel in Scottsdale that would be in the best long-term interests of its shareholders. As a result and consistent with previous indications from management, MHG is prepared for the lenders to exercise their remedies with respect to the hotel.
In June 2009, MHG discontinued subsidizing the $40 million non-recourse mortgage and mezzanine loans secured by its interests in the hotel in Scottsdale. The loans matured on June 1. For the twelve months ending September 30, 2009, the hotel had an EBITDA loss of approximately $1.4 million and had interest expense of $1.8 million, which includes approximately $0.5 million of unpaid interest which MHG has accrued since June 1.
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