Term: 2 Years with Extension Options
Prepayment: Open After 18 Months
LTC: 71%
Transaction Description:
George Smith Partners successfully arranged $42,200,000 in financing to recapitalize the construction of a 133-key extended-stay hotel on Music Row in Nashville, TN. The Lender disbursed 71% LTC, accompanied by a 12-Month interest reserve.
Multiple challenges were encountered when discussing the transaction with capital providers. The first being that the hotel is unflagged- many hospitality lenders focus primarily on popular hotelier affiliations during this risk-constrained lending environment. The team encountered a second hurdle related to mid-construction refinancing, which presented a challenging proposition from the outset of our campaign due to the hotel’s planned grand opening before November of 2023.
The GSP team was determined to leverage the deal with support from the local Nashville sponsor that owns and manages over 600 keys in the Nashville market and over 2,000 keys in the southeast, property location on Music Row in Nashville, and construction completion.
GSP successfully identified a hospitality Lender that exhibited confidence in the construction recapitalization process. This Lender was equipped to furnish the necessary funds to facilitate a smooth transition into TCO. Additionally, displaying confidence in the projected Average Daily Rate (ADR) assumptions. Notably, the Lender displayed comfort in financing the unflagged and extended-stay hotel, due to the Sponsor’s reputable track record in the market.
Advisors
Related Financings
- No related financings.
