Famous California Resort Faces Foreclosure

June 16, 2009

A Southern California resort where AIG held a luxury retreat is now facing foreclosure. The retreat was held after the company received a large sum of federal bailout money. Many said that this decision was despicable, as the money came straight from the taxpayers’ pockets.

The resort is now in default on a $70 million loan. It will go on the block for sale on July 7 unless they can negotiate an agreement with Citigroup Global Markets Realty Group. The owners also refinanced the property in 2007 and incurred $300 million in debt, plus two other current mortgages, totaling $230 million.

The resort has seen a large drop in the number of bookings, because of the failing economy. It has 400 rooms, a golf course, restaurants, and a private beach club. The executives of AIG spent $440,000 on a retreat for its managerial higher-ups.

The owners have said that their current situation will not affect the resort’s regular operation.