Transaction Overview
George Smith Partners advised on the $22,800,000 in Joint Venture QOZ (Qualified Opportunity Zone) Equity Financing for the ground-up development of the proposed Scottsdale project, a 169-key high-end lifestyle hotel. It will sit on a highly-trafficked corner of Camelback Road in the heart of Scottsdale, Arizona’s Old Town Entertainment District. The 6-story, 97,058 square foot hotel will feature a subterranean parking garage, restaurant, lounge, an indoor and outdoor fitness center, and an amenity deck complete with a pool and bar for guest entertainment.
Challenges:
Due to of the project’s location in a Qualified Opportunity Zone (QOZ), the sponsor was looking for a QOZ financing partner who would place capital for the required 10 year horizon as per the QOZ guidelines.
Solutions:
George Smith Partners focused on Greater Phoenix’s and specifically Scottsdale’s disparity of comparable lifestyle hotel product, with little to no deliveries over the past decade. The hotel’s location itself was also a major driving point; Old Town Scottsdale, Scottsdale and the Camelback Corridor are part of Phoenix metro’s largest office-employment hubs with approximately 30 million square feet of office space. Additionally, GSP showed that with the location next to the Scottsdale Entertainment District, the hotel would drive tremendous leisure travelers along with a strong F & B offering. Ultimately, an institutional JV Equity financing partner was identified who recognized the Sponsor’s talent and vision for the hospitality development and believed in the sponsor’s ability to execute the phenomenal business plan.
