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Economy sinks another high-flying Downtown plan • Brooklyn Paper

Economy sinks another high-flying Downtown plan

Whole lot of trouble: The owner of this parking area on Schermerhorn Street in Downtown has defaulted, putting a hotel project in jeopardy.
Community Newspaper Group / Andy Campbell

Hopes of a glitzy 12-story hotel in Downtown were dashed this week after the owner of the Schermerhorn Street site defaulted on his loan.

The would-be developer paid $20.7 million during the height of the real-estate boom for the parking lot between Court Street and Boerum Place on which he hoped to build a 300-room Cambria Suites with a 117-car parking lot.

But he stopped paying his mortgage, so the lot is up for sale again — this time to anyone who will take over the mortgage.

Zoning allows for a hotel, but “it would also be suitable for residential or commercial use,” said a spokesman for Massey Knakal Realty Services, which is handling the sale — likely at a discount due to the economic decline.

Developers often take advantage of repossessed mortgages like this to buy them at the discounted price.

The hotel prospect comes at a burgeoning time for tourism and housing in Downtown. The Cambria Suites would have been small potatoes compared to the 25-story, 660-room Brooklyn Marriott on Jay Street, the just-opened, 25-story Sheraton Hotel on Duffield Street, and many others in the area.

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