Copyright hoodline
A luxury Napa Valley resort that opened with fanfare just three years ago is now facing a $230 million foreclosure—a dramatic turn that highlights the mounting pressures on California's high-end hospitality market. Stanly Ranch, the sprawling 700-acre "wellness village" in south Napa, could be auctioned off to the highest bidder within 90 days if its owners can't resolve the default. The property's ownership group, SRGA LP, received notification on October 16 that their construction loan had fallen into default, according to Napa Valley Register. First American Title, acting on behalf of lender Claros Mortgage Trust, filed the notice of default after $220 million on the $235 million mortgage wasn't paid when it came due on August 18, as reported by the Press Democrat. By mid-October, the total outstanding amount had grown to $230.4 million. From High Hopes to Financial Distress When Stanly Ranch opened in April 2022, it represented a triumph of long-delayed ambition. The project had languished for years before receiving a $45 million investment in 2021 that finally brought construction to life, the Napa Valley Register reported at the time. The ownership group secured a $235 million construction loan in August 2022 from Claros Mortgage Trust to complete the ambitious development. The resort boasts 135 cottages and guest rooms spread across 78 buildings, three restaurants including a 200-seat dining venue, multiple pools, a high-tech wellness compound called Halehouse, and 110 permanent residences. Nightly rates at the Auberge Resorts-operated property start around $700, while the attached residential villas sell for upwards of $4 million, according to SFGate. Earlier this year, Stanly Ranch earned a Michelin key, a designation reserved for hotels that provide "much more than others in its price range." Red Flags Were Invisible—Until They Weren't What makes this foreclosure particularly striking is how suddenly it materialized. In Claros Mortgage Trust's latest quarterly financial report filed in early August, the Stanly Ranch mortgage (internally called "loan 5") carried a risk rating of 3—the middle tier on the real estate investment trust industry's five-level scale, notes the Press Democrat. The loan made up more than half of Claros' portfolio but wasn't among the 20 troubled mortgages on the company's watchlist. Just weeks later, the project was in default. The foreclosure filing covers 19 parcels spanning addresses from 202 to 2070 Stanly Crossroad and 1301 Stanly Lane, located at the junction of Highways 29 and 12, as documented in Napa County records reviewed by the San Francisco Chronicle. Representatives from both SRGA LP and Auberge Resorts have not responded to requests for comment about the default. Part of a Broader Hospitality Crisis Stanly Ranch's troubles arrive amid a wave of distress rippling through California's hotel sector. Two Cambria hotels in Napa and Rohnert Park entered foreclosure in 2023 over $80 million in outstanding debt, according to the North Bay Business Journal. More recently, a Newark hotel was seized by its lender following a loan default, highlighting the "wobbly values for the region's hospitality market," as reported by the Mercury News. Commercial foreclosures statewide surged dramatically in 2024. California led the nation with 264 commercial foreclosures in September 2024 alone—a 238% jump compared to the previous year, according to property data firm ATTOM. Hotel properties have been particularly vulnerable. "Hotels can slip into foreclosure much easier than people realize," Randy Newman, CEO of Total Lender Solutions, told the firm in early 2024, noting how quickly tourism and business travel can evaporate when a specific area faces economic headwinds. Napa's Luxury Market Holds—For Now Despite these challenges, Napa Valley's luxury hospitality segment has shown relative resilience. Through April 2025, Napa Valley hotels ran 2.2% ahead of the previous year's occupancy levels, with the luxury segment specifically up 5.4%, according to travel data firm STR, as cited by the North Bay Business Journal. More than half of Napa County's hotels fall into the luxury category, insulating the market somewhat from broader industry softness. The question now is whether Stanly Ranch can find a path out of default—or whether it will become another casualty in an increasingly difficult environment for high-capital hotel developments. With a 90-day clock ticking toward potential auction, the resort's fate will soon be decided. The irony is particularly sharp: just days before the foreclosure news broke, Stanly Ranch announced a partnership with Kendall Wilkinson Design to provide interior styling services to homeowners starting at $250,000, Robb Report noted. The announcement arrived as the financial foundation beneath the entire project was crumbling.
