Morgans Hotel Group Provides Update on the Status of the Debt Secured by Hudson and Mondrian Los Angeles
Morgans Hotel Group Co. (Nasdaq: MHGC) announced that it has entered into forbearance agreements with the lenders which hold the mortgage loans secured by its Hudson and Mondrian Los Angeles hotels.
The forbearance agreements effectively extend the maturities of the loans until September 12, 2010 allowing the company and the lenders to complete the negotiation and documentation of the appropriate amendments to further extend the loans. Based on the negotiations to date, we believe that the time will result in a combination of amendments to the loans and extensions of the maturities.
The loans are comprised of a $217.0 million first mortgage secured by the Hudson and a $120.5 million first mortgage loan secured by the Mondrian Los Angeles. In October 2009, the Company effectively extended the maturity of the $26.5 million Hudson mezzanine loan to 2013 by entering into a forbearance agreement with the holder of that loan. The first mortgage loans were scheduled to mature on July 12, 2010 with options to extend the maturities to October 2011 provided that certain conditions were met. The Company is in negotiations with the mortgage lenders to amend the terms and conditions of the extensions.
