Owner of troubled hotels gets financing

Firm that owns East Bay, South Bay, Monterey Bay area businesses reports cash squeeze — but eyes rescue

The owner of seven top-notch hotels in and near the Bay Area has warned regulators that it faces a severe cash squeeze and possible bankruptcy — but also says it hopes a financing package provided by a major investor could help ward off its money struggles.

The scramble by Ashford Hospitality to land financing in the wake of its warning that it was facing potential bankruptcy are the latest indicators of the coronavirus-linked financial and economic roller coaster that confronts the lodging and travel sectors.

Texas-based Ashford Hospitality Trust, which owns hotels in 27 states including California, warned in a Dec. 22 filing with the Securities and Exchange Commission that it is suffering liquidity problems that are serious enough to shove the company into a Chapter 11 bankruptcy filing.

However, in a Dec. 28 filing with the SEC, Ashford Hospitality stated that it had secured a financing commitment of at least $200 million from Oaktree Capital Management that could dramatically ease the lodging company’s financial squeeze.

“We believe this strategic financing commitment provides substantial capital and ample liquidity for Ashford Trust to capitalize on the upcoming recovery in the hospitality industry,” said J. Robison Hays, chief executive officer with Ashford Hospitality Trust.

Texas- based Ashford Hospitality’s lodging properties include six hotels in the Bay Area and one hotel in the Monterey Bay area, according to the company’s website.

The hotel owner said it believes it has enough cash to fund its operations “into the early part of fiscal year 2021,” Ashford Hospitality stated in a recent SEC filing Ashford’s fiscal year is identical to the calendar year.

The company owns the Courtyard Oakland Airport in Oakland; Courtyard Newark and Res