The Thompson San Antonio – Riverwalk hotel has received a notice of foreclosure sale tied to a significant loan amounting to $44 million. According to records from Bexar County, this foreclosure notice was issued by affiliated lenders Sunrise Realty Trust and Southern Realty Trust, affecting only the hotel portion of the building located at 115 Lexington Ave..
The refinancing deal for the property was completed in 2024, under a condominium agreement that separates the building’s various uses. The lenders indicated in a notice dated February 6, 2025, that they provided the developer, DC Partners, with multiple opportunities throughout the year to rectify the default.
In a statement provided through a spokesperson, DC Partners cited several factors contributing to the hotel’s underperformance. These include prolonged stabilization timelines, increased competition from new downtown hotels, and prevailing high-interest rates, which collectively impacted the property’s financial health. The firm noted, “These factors — including opening during COVID and a broader softness in the San Antonio hotel market — created challenges that were not anticipated and challenging to overcome. This is not a reflection of the quality of the asset or the long-term viability of the project, but rather a convergence of market forces affecting many developers across the country.”
The Thompson San Antonio Hotel, developed and opened by Houston-based DC Partners in 2021, features 162 rooms and 59 condos. This latest development comes only 18 months after the real estate investment trusts (REITs) provided the refinanced loan. In 2022, DC Partners secured an additional $38 million refinancing deal from Miami-based 3650 REIT.
Representatives from Sunrise Realty Trust and Southern Realty Trust declined to comment on the situation when approached for this article. In a previous statement, Brian Sedrish, chief executive of both firms, expressed confidence in the hotel’s potential. He stated that the refinancing was intended to support DC Partners’ growth in Texas and meet the demand for upscale accommodations in the area.
The foreclosure auction is scheduled for March 3, 2025, at the Bexar County Courthouse. This auction marks a critical juncture for the Thompson San Antonio, as the hotel navigates a challenging market landscape.
This article was published through a partnership between KSAT and the San Antonio Business Journal.
