The DoubleTree by Hilton Cleveland Downtown is set to permanently close Jan. 30, ending a yearslong struggle with declining performance and mounting debt that left the hotel unable to recover.
The closing comes despite the hotel's proximity to the shores of Lake Erie and major tourist attractions, including Huntington Bank Field — home of the NFL's Cleveland Browns — the Great Lakes Science Center and the Rock & Roll Hall of Fame.
Investors in a commercial mortgage-backed securities offering holding a $25.4 million loan on the property are projected to lose their investment.
Crescent Hotels & Resorts, the hotel's operator, announced the closing in a Worker Adjustment and Retraining Notification filing this week with the state of Ohio. The company plans to lay off all 66 employees between Jan. 28 and Jan. 30.
"Business reasons which are out of the company's control" drove the decision, and management had "no ability to undertake remedial measures that would mitigate or avoid the closure," Crescent said in its WARN notice.
The 379-room full-service hotel at 1111 Lakeside Ave. E. has hemorrhaged value since 2019. Lenders transferred the property's loan to special servicing in October 2019 after cash flow collapsed. A court appointed a receiver in January 2020.
The property's decline accelerated through the pandemic and never reversed. The hotel had a 27.58% occupancy rate through May 2025, with an average daily rate of $131.18 and a revenue per available room of $36.18, according to service reports.
The DoubleTree closing illustrates how legacy debt from pre-pandemic commercial real estate deals continues to unwind in secondary markets.
The property's collapse — from a $40 million valuation at loan origination to $16.6 million in February 2024 — represents a 58.5% decline in value that forced lenders to absorb total losses on the $25.4 million loan balance.
The hotel underperformed its competitive set even before COVID-19 struck. The borrower stopped submitting financial reports years ago, according to notes from CMBS servicer Greystone Servicing.
Morningstar DBRS reported last month that the CMBS trust wrote off $10.5 million in nonrecoverable advances and assumed 100% loss severity on the loan.
A previous sale by the property's owner, the Edmonds, Washington-based Hotel Group, failed when a prospective buyer was unable to secure financing. The special servicer continues to market the property, with interested parties expected to submit new offers soon, according to Greystone.
Crescent and the Hotel Group did not immediately respond to CoStar News' requests for comment.