The $100 million commercial mortgage-backed securities loans secured by the Hyatt Regency hotel next to the Exchange Place PATH station in the Jersey City waterfront have seemingly run aground 10 years after they were originated.
Multiple outlets reported that, based on a Morningstar Credit Analytics report from mid-September, three CMBS tied to the hotel have been sent to a special servicer over concerns that they will default next month, when the loans are set to mature.
The Hyatt Regency consists of 351 suites and was built in 2002. A July report in Sleeper Magazine says the hotel’s guestrooms and public spaces, including its lobby, lounge, restaurant, and event areas, were redesigned earlier this year. The redesign, led by Englewood, Florida-based hotel design firm Suomi Design Works, also added a gaming area with billiards, a grab-and-go market, and expanded the fitness center to twice its original size.
The hotel is co-owned by New York-based investment firm Taconic Capital Advisors and HEI Hotels & Resorts. The hotel includes a gym, indoor heated pool, a restaurant and lounge, and 20,000 square feet of conference space.
A report in The Real Deal says the owners stated they would not be able to pay off the loan by next month, even though Morningstar reported that a deal could be worked out.
A report in Commercial Observer says the only year the Hyatt Regency’s net cash flow met the levels underwritten on the debt was 2016, when the CMBS were originated. The hotel reported negative cash flow in 2024, and its net income was 68% less than its underwritten expectation in 2025.
A press release issued by Taconic and HEI states the joint venture purchased the hotel in late 2022. The joint venture assumed “a $100 million fixed-rate CMBS with ample remaining term” as part of the transaction and said it had invested over $15 million in upgrades since 2010.
Jersey Digs reported that Veris Residential and Hyatt Hotels sold the hotel.
Taconic and HEI purchased the Westchester Marriott in Tarrytown, New York, in March 2022. That property spans 15 acres and includes 444 guest rooms, 21 event rooms and 26,700 square feet of meeting space, including a 9,000-square-foot ballroom.
Taconic and Morningstar did not respond to Jersey Digs’ request for comment.
