$52,743,000 Senior Construction Loan for Dual-Branded Hotel

Transaction Description:  GSP placed the senior construction loan for a mid & luxury dual-branded high rise hotel. The 332 Room Hotel (188 Room Luxury Hotel & 148 Room Mid-level Hotel) is located in a primary California market. Floating over LIBOR with a 5.25% floor, the 51.5% of cost loan carries a 3½ year term allowing time for construction and stabilization prior to the need for options.

Challenge: The project was entitled & construction drawings had been completed prior to the ’08 recession. The sponsor had been unable to secure the financing for a variety of reasons prior to hiring GSP.

Solution: GSP secured a lender that had significant expertise in Type I hospitality construction and is knowledgeable of the hotel flag’s management company. GSP was involved throughout the process for the negotiation and execution of the management agreement and the selection of the GC and GMP/ GMAX construction contract; both vital to securing the construction facility. Upon contract executions, GSP utilized it’s expertise to prove the strength of the hotel and hotel brand’s with out-of-market and in-market performance data. This process assured the lender that the project is feasible from a cost, revenue & valuation perspective.