Home Hotels Chicago’s Famous Palmer House Hotel In Foreclosure. Will It Ever Reopen?

Chicago’s Famous Palmer House Hotel In Foreclosure. Will It Ever Reopen?

by joeheg

The 1,600 room Palmer House is the second-largest hotel in Chicago. Currently part of the Hilton Hotels portfolio, it’s been a part of the Chicago landscape for over 145 years. Because of the coronavirus, the hotel has been closed since March. The Hilton website currently shows the hotel as sold out but rooms are showing as available starting in December.

I wouldn’t go rushing into any reservation, as there’s a question to if the hotel will reopen at all.

The Palmer House depended on conventions and business travel for most of its income and even if the hotel opens, there’s no telling when that type of business will return.

Signs that the hotel was in trouble started back in April. Just one month after the closure the hotel’s owner, Thor Equities, skipped a loan payment on the $427 million refinance they took out on the property in 2018.

Things haven’t gotten any better since then. The Chicago Tribune reports that the banks have recently sued to foreclose on the property.

The owner of the historic Palmer House Hilton has been sued for almost $338 million in missed loan payments, in the largest Chicago foreclosure case to emerge from the coronavirus pandemic.

New York-based owner Thor Equities was sued Aug. 20 in Cook County Circuit Court by Wells Fargo Bank. Thor Equities has missed monthly loan payments since April on the sprawling 1,641-room Loop hotel, and the $333.2 million loan hasn’t been paid off in full since it matured in June, the complaint alleges.

Hilton has a long history with the Palmer House since Conrad Hilton purchased the hotel in 1945. While Hilton still operates the Palmer House under a management contract, it has no ownership in the actual building after selling it to Thor Equities in 2005 for $230 million.

We stopped by the hotel during our quick trip to Chicago in 2017 and had a drink at the lobby bar. It was like stepping back into the past. Sharon and I love visiting places like this, even if we don’t always stay at them.

While the ownership and debt will be settled either in or out of court, it’s a strong bet that the Hilton name will still be attached to the hotel. It remains to see how these grand old hotels will be able to operate in a travel industry post-2020. For me, I sure hope they find some way to keep the Palmer House open. It’d be a shame to lose it.

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This post first appeared on Your Mileage May Vary

1 comment

derek September 7, 2020 - 12:51 pm

The fate of the hotel rests upon if McCormick Center is having big conventions. If not, the hotel is doomed.

Reply

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