Finance Deals Heat Up Hospitality

INTERNATIONAL REPORT—What’s happening in finance across the industry? Here’s the details on the recent transactions taking place:

RobertDouglas Advises Clarion Partners on $684M Refi
RobertDouglas has advised Clarion Partners LLC in securing a $684-million, non-recourse senior mortgage, five-year, fixed-rate financing for the refinancing of CBM Two Hotels LP Portfolio, a portfolio consisting of 52 Courtyard by Marriott hotels.

The 7,677-key portfolio is comprised of fee and leasehold interests throughout 25 states and 37 metropolitan areas. Since acquisition in 2005, the sponsor has spent more than $300 million in capital improvements to the portfolio and recently began a multi-year, $220-million, portfolio-wide renovation that includes a modern exterior redesign and updated guestroom product.

Mag Mile Capital Completes $23.65M in Loans for Michigan Hotel Portfolio
Mag Mile Capital’s SVP Francisco Nacorda has completed $23.65 million in CMBS loans for three hotels as part of a Michigan select-service hotel portfolio on behalf of the borrower, Stellar Hospitality. In the first transaction, Mag Mile Capital arranged a $9.4 million non-recourse, CMBS loan for a 94-room Staybridge Suites by Intercontinental Hotels Group in Grand Rapids, MI at an interest rate of 4.29% with a 10-year term and 25-year amortization.

Nacorda also facilitated a $8.5 million non-recourse, CMBS loan for the 89-room Homewood Suites by Hilton in Novi, MI. This 10-year loan also features a 25-year amortization with an interest rate of 4.29%.

In the final transaction, the team closed a $5.75 million non-recourse, CMBS loan for the Tru Hotel by Hilton in Sterling Heights, MI. The transaction featured a 10-year term with 25-year amortization and interest rate of 4.23% for the 98-room hotel.

JLL Arranges $57.58M Loan for Extended-Stay Hotel in Chicago
JLL Capital Markets has arranged a $57.58 million refinancing for Home2Suites by Hilton Chicago River North, a newly constructed, 206-suite, extended-stay hotel in Chicago’s downtown River North neighborhood. JLL worked on behalf of the borrower, Akara Partners, to place the floating-rate loan with a global investment management firm. Loan proceeds will be used to refinance the construction loan.

The Home2Suites is between Michigan Ave. and the Loop, the downtown financial district. The hotel is surrounded by 146 million sq. ft. of office space and within walking distance to the new, $100-million Chicago Riverwalk.

Sonnenblick-Eichner Arranges $17.75M Loan for DC Hotel
Sonnenblick-Eichner Company has arranged $17.75 million of interim first mortgage financing for The Normandy Hotel, a six-story, 75-room boutique hotel located in the upscale Kalorama district of Washington, DC. The non-recourse LIBOR-based loan has a term of five years and paid off an existing acquisition and renovation loan that was also arranged by Sonnenblick-Eichner Company.

In September 2018, the borrower completed an $800,000 refresh of the hotel. The refresh included the lobby, hallway and guestroom renovations, common area casegoods, broadband connectivity, new exterior paint, signage, lighting and landscaping.

Twain Financial Provides $34M to Temecula Resort
Twain Financial Partners provided $34 million in Property Assessed Clean Energy (PACE) Financing to the development of a luxury boutique hotel and parking structure located in the Old Town neighborhood in Temecula, CA.

The project, currently 1.75 acres of unimproved land, will be transformed into a 185-room Autograph Collection hotel. Construction is scheduled to begin early this year and is expected to complete by September 2021. Twain provided financing for the resort through Western Riverside Council of Governments’ (WRCOG) C-PACE program. The project will be managed by Truax Development and will include water and energy efficiency features and automated technology in the parking structure. The PACE proceeds will be used to fund seismic improvements on both the hotel and parking structure.

CHC Secures Combined $95M to Refi Five Hotels
CHC Hotel Capital has arranged a total of $95 million for the refinance of four hotels in Charlotte, NC and one hotel in downtown Columbia, SC. The loans were individually placed with a national lender and each one offered a 10-year term, 10-years of interest only and a fixed interest rate locked between 3.42% and 3.45%. The properties are all owned by SREE Hotels, a hotel owner, developer and manager based in Charlotte, NC. KPPB Law represented the borrower on the transaction.

Petros Pace Finance Provides $4.2M in C-PACE Financing for Hotel Conversion
Petros Pace Finance LLC has closed a $4.2 million Commercial Property Assessed Clean Energy (C-PACE) transaction with REV Development, an owner, developer and operator of hospitality properties, to finance energy-saving upgrades in the conversion of a historic building into a boutique hotel in downtown Omaha, NE.

The transaction will fund a portion of the renovation of Omaha’s century-old Logan Building. The seven-story building will be operated as a 90-key Hotel Indigo, with additional space for condos and ground-level retail that also includes a restaurant and speakeasy. The redevelopment project included energy-saving improvements to the property’s lighting, HVAC, windows, roofing and plumbing systems. Completion of construction is expected by July of 2020.

Centennial Bank Closes on Loan for Treasure Island Resort
Centennial Bank closed a $6 million permanent loan with Dolphin Reef LLC. Centennial Bank arranged the first mortgage loan for Fusion Resort Treasure Island, a new 42-suite intercoastal waterfront luxury resort on Treasure Island. The property has two- and three-bedroom suites, 18 boat slips for resort guests, as well as food and beverage options. The hotel is a Class A property in the market that caters to the area’s year-round visitors.

Treasure Island has been a frequented vacation destination along the Gulf of Mexico with proximity to St. Petersburg and Tampa, FL. Drawing more than 11 million visitors between Q1-Q3 2019, the area has a thriving tourism sector bringing in more than $4 billion of visitor spending during the same time period.