TIBURON — A boutique hotel nestled in an exclusive Bay Area enclave has been bought through a speedy foreclosure transaction, a fresh sign that economic woes still afflict the region’s weak hospitality sector.
Denver-based hospitality group KSL Capital Partners, which this month bought Los Gatos’ Toll House Hotel through a similarly swift foreclosure procedure, has also purchased The Lodge at Tiburon, documents in Marin County and Santa Clara County show.
Toll House Hotel at 140 South Santa Cruz Avenue in Los Gatos, seen in February 2026. (Google Maps)
Rhode Island-based Procaccianti Cos., which bought the two boutique hotels in 2019, sold them to KSL for considerably less than their prior values, a review of property filings shows.
The 102-unit Lodge at Tiburon was bought for no more than the $27.6 million in unpaid debt that burdened the hotel at the time of its purchase, according to a document on file at the Marin County Recorder’s Office. Procaccianti Cos. paid $34 million for it in 2019, meaning the hotel’s value has plunged by at least 18.8%.
Similarly, the 115-unit Toll House Hotel in Los Gatos has suffered a decline of at least 31% in value since 2019, when an affiliate of the Procaccianti firm paid $43.5 million for it.
Each of the prior purchases occurred the year before the imposition of wide-ranging business shutdowns triggered by the COVID-19 pandemic.
The hotel market was flying high until the coronavirus outbreak. Since then, waves of failed loans and foreclosures have haunted the Bay Area hospitality sector, as sketched out in a recent report by Atlas Hospitality Group.
Hotels in San Jose, Oakland, and San Francisco have been foreclosed by their lenders.
Despite the foreclosures, the Toll House Hotel in Los Gatos and The Lodge at Tiburon in the North Bay have plenty of upside due to their locations in markets that are desirable, said Alan Reay, president of Atlas Hospitality.
“These are both trophy assets,” Reay said. “I know both properties. They are really well-located.”