Oh, the irony. The St. Regis resort made famous as the spot where AIG staged a blowout, $440,000 party for its salespeople just weeks after receiving $85 billion in federal bailout money has been foreclosed upon. And who is stuck with the property? None other than wobbly, taxpayer bailed-out Citigroup.

According to the Los Angeles Times the resort may be worth less than one-third of the $300 million in debt on its books. As one investment banker told the paper: “The property has already been nearly catastrophically damaged, through no fault of its own or the previous ownership, by the unwanted media exposure going back to when AIG held their conference.”

The resort’s problems aren’t really related to AIG. It’s just got too much debt to ride out an awful market for high-end hotels. There’s a big debate in all luxury product circles these days about when, and if, consumers will ever spend like they used to. St. Regis’ owners decided they afford to wait and find out the answer.