Park Hotels halts payments on $725M loan, reduces San Francisco presence.

Park Hotels & Resorts has stopped making payments on a $725m non-recourse CMBS loan secured by the Hilton San Francisco Union Square and Parc 55 San Francisco, and expects these hotels to be removed from its portfolio. The REIT plans to materially reduce its exposure to San Francisco due to concerns over street conditions, record high office vacancy, and a weaker than expected citywide convention calendar through 2027. Removing the loan and the hotels will improve Park Hotels' balance sheet and operating metrics, and the REIT expects a special dividend of $150m to $175m following the disposition of both hotels.