The reopening of a bankrupt downtown San Jose hotel that’s been closed since March in the wake of the coronavirus has landed in limbo after a judge’s ruling, the East Bay Times reported. A set of decisions by a bankruptcy judge enables the start of an arbitration proceeding to resolve a dispute between the bankrupt Fairmont San Jose hotel’s owner and the iconic lodging’s operators. “It is likely that a decision will be made by the arbitrator at the end of the next 5 to 6 months, essentially by the end of the year,” said Sam Singer, a spokesperson for the group that owns the double-tower hotel in downtown San Jose. That in turn has left the date and circumstances under which the hotel can reopen up in the air. “We do not have a firm date on the property’s reopening,” Singer said. The 805-room Fairmont San Jose shut its doors in March, around the same time that the hotel’s owners, a group led by business executive Sam Hirbod, filed for a chapter 11 bankruptcy to attempt to reorganize the hotels’ shattered finances. In May, the ownership group picked Hilton Hotels & Resorts as the new manager and operator. “The Hilton bid contemplates that the hotel will assume the name ‘Signia by Hilton San Jose’ or another name that includes ‘Signia’ in it and that it will be managed by Hilton upon its reopening,” bankruptcy court records show. Court papers show that Hilton has agreed to inject about $45.8 million in financing to help stabilize the hotel. JPMorgan Chase Bank has also agreed to provide another $25 million in funding for the hotel to assist its emergence from bankruptcy.
