Aries/Conlon Capital has arranged six hotel refinancing transactions totaling more than $40 million for limited service hotels in Florida, Arkansas, Texas, Kentucky and Ohio.
Aries/Conlon Capital Principal and CEO Rushi Shah and Associate Suraj Desai from the firm’s Chicago office, and Senior Vice President Michael Taylor from its Dallas/Irving office, originated the conventional and non-recourse CMBS loans on behalf of the multiple borrowers.
“We successfully structured the hotel financing around a variety of challenges to deliver for our clients,” said Shah. “Some examples of what we overcame include: a change in ownership flag during the refinance process; a negative default history on a property; an expiring franchise agreement during the loan term; issues with a Quality Assessment Report from the franchise; impending political changes that might negatively impact the property’s primary demand drivers; and the looming maturity of an existing loan. Our creativity and ability to solve problems quickly, not only benefit our clients, but are also skills highly-valued by our capital sources. This gives us a competitive edge in the marketplace.”
The recently closed transactions include:
A $7.5 million, 10-year fixed rate conventional loan with a 20-year amortization and a 60% loan-to-value ratio for a La Quinta Inn & Suites on Florida’s Gulf Coast. Co-originated by Shah and Desai, the loan was closed with one of the country’s largest credit unions in just 28 days and included significant cash-out to the borrower.
A $6.15 million, 10-year fixed rate, non-recourse CMBS permanent loan with a 25-year amortization for a La Quinta Inn & Suites in Tampa, Florida. The loan provided significant cash-out to the borrower and was originated by Shah.
A $7.8 million, 10-year fixed rate, non-recourse CMBS permanent loan for the refinance of a repeat client’s four-property portfolio. The portfolio included a La Quinta Inn & Suites and a Country Inn & Suites in Hot Springs, Arkansas. Originated by Shah, the loan allowed the borrower to pay off an existing bank loan and outstanding franchise and Property Improvement Plan (PIP) fees, plus establish a seasonal reserve.
A $5.075 million, 10-year fixed rate, non-recourse CMBS loan with a 25-year amortization for a multi-hotel portfolio near the U.S.-Mexico border in Eagle Pass, Texas. Co-originated by Taylor and Shah, the loan included a closing credit for the borrower to cover a deficit in proceeds.
A $6.75 million, 10-year fixed rate, non-recourse CMBS loan with a 30-year amortization and a 70% loan-to-value ratio for the refinance and reflag of a Red Roof Inn to a Country Inn & Suites in Erlanger, Kentucky. Shah was the originator for the transaction.
A $6.75 million, 10-year fixed rate, non-recourse CMBS loan with a 30-year amortization and a 70% loan-to-value ratio for a Fairfield Inn & Suites by Marriott outside Columbus, Ohio. Shah arranged the loan.
“This was my fifth CMBS loan closing as a hotel owner. Having worked with many of Rushi’s competitors in the past, I believe that Aries/Conlon’s talent, professionalism and transparency is unsurpassed,” said Amar Pandey, President of Hospitality Synergy Group, Inc. and the borrower for one of the transactions. “I was impressed with how Rushi expertly maneuvered around the issues and crafted favorable solutions. The closing team was also extremely efficient, which made the process easier for me. I look forward to working with Aries/Conlon again in the future.”
“Momentum is a key strategy for our platform. As the threat of long-term rates rising and capital drying up due to the economic downturn increases, more and more of our borrower-clients are looking to us to refinance their existing properties with long-term, non-recourse financing with maximum allowable cash out. This will ensure they have funds available to deploy when it’s time to start buying and developing value-added commercial real estate again,” added Shah. “Furthermore, our deep relationships with the lenders and high loan volume, gives us a tremendous amount of leverage in the transaction and ensures an efficient closing process for our clients.”