NATIONAL REPORT—Funds are flowing for a variety of hotel projects, helping keep the momentum going for owner and developer activity. Here’s a pair to know.
Construction Loan a Go in San Diego
Holliday Fenoglio Fowler LP (HFF) has secured $36.5 million in construction financing for the renovation and development of The Guild San Diego, a 163-room, upscale hotel in downtown San Diego.
Working on behalf of the developer, Oram Hotels, the HFF team placed the construction loan with Regents Bank. Loan proceeds will be used to continue the conversion of the historic 500 West Broadway building into a four-star boutique hotel with an expected completion in spring 2019.
Azul Hospitality Group will manage the hotel.
The Guild San Diego will be part of Marriott’s recently acquired Tribute Portfolio brand. The seven-story hotel will feature 7,000 sq. ft. of indoor meeting space and 9,000 sq. ft. of outdoor banquet space; a garden and courtyard featuring art, floating walls, green areas and lounge seating; guestrooms with reclaimed wood headboards and concrete ceilings; and several food and beverage options, including a restaurant and tapas kitchen, courtyard cocktail bar, lobby bar, basement speakeasy and specialty coffee bar with mercantile shop carrying local San Diego flagship brands.
The hotel’s location in downtown San Diego’s Columbia neighborhood is along the Broadway corridor near Little Italy and provides guests a gateway to the entire downtown area, including the historic Gaslamp Quarter, Embarcadero and Waterfront Park. Additionally, a 6.5-block, five-level outdoor shopping mall is within a half mile of the hotel site.
HFF’s debt placement team included Senior Managing Director Aldon Cole and Managing Director Scott Hall.
MidCap Arranges $4.1M for Charleston Hawthorn Suites
In South Carolina, MidCap Funding has arranged a $4.1 million loan for the refinance of a 77-key Hawthorn Suites by Wyndham in Charleston.
The bridge loan was structured as interest-only and executed via a private equity lender. Loan proceeds were used to take out the existing CMBS financing and to renovate the hotel over the next six months.
Taylor W. Grace, managing partner at MidCap Funding, negotiated the refinance on behalf of the borrower. While initially seeking a new CMBS loan, the solution was executed via one of MidCap’s existing private equity relationships. This structure will allow the borrower to renovate the hotel and focus on pushing performance metrics over the next year, according to MidCap, noting once that is complete, a long-term takeout via CMBS is anticipated.
“Though we faced many challenges with this loan, including a major hurricane (Irma) that disrupted operations, and a last minute hold-up due to the first snowstorm in Charleston since 1989, we were able to work closely with the borrower to provide a successful execution. We intend to continue working with the borrower post-closing to position the hotel for the best possible permanent loan after renovations are complete,” Grace said.