Fairmont Hotel in San Jose files for bankruptcy, plans to reopen

The 805room San Jose Fairmont Hotel, Silicon Valley’s largest hotel, has filed for bankruptcy and plans to restructure with a new brand and new management to reopen within 60 to 90 days.

The temporary closure of the twotower landmark hotel — which owner FMT SJ LLC said lost at least $18 million in 2020 and is projected to lose at least an additional $20 million this year — underscores the economic damage of the coronavirus pandemic on the hotel and tourism industries.

The hotel closed Friday and relocated fewer than 50 guests to other hotels in San Jose and paid for their lodging, hotel spokesman Sam Singer told The Chronicle.

All hospitality staff were laid off on Friday, including union members and hotel management, said Singer, who didn’t have the number of layoffs. They were paid through Friday. On Saturday, the only people at the hotel were security guards and engineers, Singer said.

“We know that by taking this difficult step we

will come back a more vibrant hotel to the benefit of everyone in San Jose, including the vitality of the City’s downtown, nearby businesses, and Silicon Valley conventions in a post-COVID19 world,” Singer said in a statement.

Hotel owners are working to find a new hotel brand that will provide “substantial” financing that will allow the hotel to exit bankruptcy.

Ownership officials said in a statement that they hope to have a new brand under new management that has the “ability and willingness to infuse tens of millions of dollars of capital into the hotel and its operations, and a robust pipeline of future convention business for the hotel.”

The ownership group, which includes San Ramon's Eagle Canyon Capital, bought the hotel in 2018 for $223.5 million, according to property records. The hotel opened in 1987 and was built by the Swig family.

The hotel has 65,000 square feet of meeting and event space, three restaurants with bars, cafe bakery, fitness center and a rooftop pool and gazebo.

Singer said the hotel hopes to reopen as vaccine distribution helps the local economy recover and conventions eventually return.

Justin Sullivan / Getty Images 2007 The San Jose Fairmont Hotel, shown in 2007, has closed and filed for bankruptcy. The hotel plans to reopen under new management in a few months.