The San Jose Fairmont Hotel is officially closed – for now. The hotel closed its doors and relocated existing guests to nearby hotels this afternoon as its operator, FMT SJ LLC, filed for Chapter 11 reorganization “in order to find a management partner and extend existing mortgage debt,” according to the announcement.
The hotel suffered in the last year largely due to the pandemic, with 2020 and 2021 conferences cancelled and occupancy rates at about seven percent. The hotel lost $18 million in 2020 and expects to lose another $20 million in 2021, according to the owner.
The hotel’s secured lender is expected to work cooperatively to ensure the hotel comes back stronger after its reorganization. Ownership expects the hotel to reopen mid-year with a new manager/brand, one with “the ability and willingness to infuse tens of millions of dollars of capital into the hotel and its operations.”
“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-COVID-19 world,” said the hotel’s representative Sam Singer.
The hotel is an 805-room property at 170 South Market St., San Jose, in the heart of Silicon Valley. The 20-story, two tower hotel has 65,000 sq. ft. of state-of-the-art meeting and event space, three restaurants with bars, a café bakery, a fitness center, and a rooftop pool and gazebo. The hotel features grand ballrooms for large conferences and conventions as well as intimate spaces for smaller gatherings.