A Look at Hotel Finance Deals

INTERNATIONAL REPORT—Hotel transactions are taking place across the country. Here’s a closer look at financing deals in California, Georgia, Indiana, Utah and Michigan:

Geolo Capital Launches Hospitality Finance Vertical
Geolo Capital, the private equity investment arm of the John Pritzker family office, has launched a new hospitality finance vertical with the closing of two investment deals—Alila Marea in Encinitas, CA, and Kimpton Buckhead in Atlanta. Following Geolo’s sale of Two Roads Hospitality to Hyatt Hotels Corporation, the company is now expanding its investment parameters with its new structured finance vertical, which will deploy mezzanine and preferred equity investments in hospitality projects across both urban gateways and resort destinations.

In partnership with JMI Realty and Fenway Capital Advisors, Geolo recently closed an investment in Alila Marea. When the resort opens in 2021, the property will be the second Alila in North America, following Geolo Capital’s Ventana Big Sur, an Alila Resort.

Additionally, Geolo recently closed an investment in the adaptive-reuse of Buckhead’s Sobu Flats, near Buckhead Village, in partnership with Portman Holdings. Currently an eight-story residential condominium property, the 1950s Atlanta address will undergo a renovation to re-emerge as a 216-room hotel managed by Kimpton Hotels & Restaurants. Kimpton Buckhead is set to complete in 2021.

Vista Capital Closes Financing for Two Hotels in Indiana
Vista Capital Company has arranged $22.5 million in financing for the Candlewood Suites located in Terre Haute, IN, and the Holiday Inn Express in downtown Indianapolis. The loans were funded separately and were not cross-collateralized. Both properties recently underwent renovations. Indiana’s hospitality market is growing despite new supply over the last few years, powering a resilient sector that is attracting institutional investment. The Terre Haute market will soon be boosted by a new convention center, while Indianapolis remains a solid and growing.

JLL Arranges Construction Financing for Utah Property
JLL has arranged construction financing for the development of Cottonwood Courtyard, a 149-key, select-service hotel in Cottonwood Heights, UT, serving Alta, Snowbird, Solitude and Brighton Mountain Resorts. JLL worked on behalf of the developer, a partnership between Yang Capital Group, Alex. Brown Realty and Huntington Hotel Group, to place the three-year construction loan with National Bank of Arizona. The groundbreaking occurred in November. Once completed in 2021, Cottonwood Courtyard will be part of a 10.89-acre mixed-use development that will include more than 79,000 sq. ft. of office space, three restaurants, a distillery, a park for events, 150 apartments, 17 townhomes and additional retail space.

Arriba Capital Closes on Construction Loan in Michigan
Arriba Capital has recently closed a $9.3-million construction-to-perm conventional loan
for the 206-key, Best Western Premier full-service hotel in Southfield, MI. The new loan will allow the borrower to add more than 50 extended-stay rooms to complement the existing king & double/double rooms. Southfield, a northern suburb of Detroit, is a commercial and business hub that houses over 100 Fortune 500 companies, eight colleges and has a population of more than 70,000 people.