SAN JOSE — A San Jose hotel has flopped into a default due to a delinquent loan, a financial setback that serves as a new reminder of the lingering ailments for the region’s hospitality sector.
The owner of the La Quinta Inn & Suites hotel in north San Jose has defaulted on a $16 million loan, documents filed on May 21 with the Santa Clara County Recorder’s Office show.
The default is a fresh example of the mortgage defaults, fading values and foreclosures that plague the Bay Area hotel market, more than six years after the onset of the COVID-19 pandemic that upended the worldwide travel and hospitality sectors.
The 59-room hotel that’s in default is located at 1036 North Fourth St. in San Jose. The delinquency means the hotel faces foreclosure if its owner can’t repay the lender in full.
Central Valley Community Bank provided the hotel’s owner with the now-delinquent construction loan in 2019, according to the county real estate records.
Los Gatos-based Milanben Patel and Anil Patel are listed as the principal managers of the business entity that owns the hotel.
The hotel was completed in 2023, city permit documents filed with the Recorder’s Office show.
The lodging industry’s distress has jolted hotels throughout the Bay Area in recent years, causing ailments that have afflicted hotels of nearly every size in the region.
In 2025, foreclosures engulfed high-profile hotels in downtown Oakland, including the 500-room Oakland Marriott City Center hotel and a 276-room dual-branded hotel in the trendy Uptown district.
San Jose’s largest hotel, the 541-room Signia by Hilton in the city’s downtown district, was seized by its lender in 2025.
The current wave of woes for Bay Area hotels began in 2023 with the foreclosure of the Huntington Hotel atop Nob Hill in San Francisco at a $29.3 million price tag, which was a fraction of the hotel’s $86.7 million assessed value.
Two of San Francisco’s largest hotels, the Hilton San Francisco Union Square and Parc 55, were foreclosed and then sold by a court-appointed receiver for $408 million, a 75% nosedive in the value of the two lodging towers.