Sonnenblick-Eichner Company announced that it has arranged $236,750,000 of first mortgage financing for seven lifestyle hotels totaling 1,072 rooms that are owned and operated by Portland, Ore.-based Provenance Hotels. The hotels are located in the central business districts of Portland and Seattle, as well as a property in Nashville.
Six of the properties received 10-year fixed rate loans, all non-recourse and not cross-collateralized. These include: Hotel Lucia, Portland, Ore.; Hotel deLuxe, Portland, Ore.; Sentinel, Portland, Ore.; Westin Portland, Portland, Ore.; Hotel Max, Seattle; and Hotel Preston, Nashville. Following the financings, these six hotels were acquired by Provenance Hotels’ newly launched $525 million fund, Provenance Hotel Partners Fund I. The financing of the seventh hotel, the Roosevelt Hotel located in Seattle, was a non-recourse LIBOR-based facility that Provenance Hotels used to acquire their partners’ equity interest and for the upcoming renovation and repositioning of the hotel.
Elliot Eichner, a principal of Sonnenblick-Eichner Company, commented, “The borrower chose to refinance a majority of the loans prior to maturity. The cost of prepayment was mitigated by the lower cost of capital and the risk associated with the potential of higher interest rates in the future. The Borrower also realized pent-up equity they had in the portfolio.”
Patrick Brown, also a principal of Sonnenblick-Eichner Company, added: “We were engaged to refinance loans we had previously arranged for the borrower. Through our marketing efforts we were able to source financing quotes from multiple capital sources.”