On the financing front, PMZ Capital has arranged a loan for a Westin near Baltimore/Washington International Airport, Knighthead Funding has provided financing for two Memphis-area hotels and VICI Properties has entered into a strategic agreement to provide financing for Great Wolf Lodge.
PMZ Realty Capital arranges loan for Westin Baltimore
PMZ Realty Capital LLC, a national boutique real estate investment banking firm, has arranged a $27 million non-recourse loan with a life insurance company for the Westin Baltimore Washington Airport—BWI. The proceeds of the loan will be used to pay off the existing mortgage, which had matured.
The 260-room property features free WiFi, the WestinWORKOUT Fitness studio, a heated indoor pool, a 24-hour business center and 13,226 sq. ft. of meeting space separated into nine event rooms.
The hotel is located less than three miles from the Baltimore/Washington International Airport, and near attractions such as the National Aquarium, Oriole Park at Camden Yards, University of Maryland, Baltimore Inner Harbor and M&T Bank Stadium.
Knighthead Funding provides $12.1M to refinance two Memphis-area hotels
Knighthead Funding LLC has provided a Tennessee-based partnership specializing in hotel development and management with a $12.1 million first mortgage loan to refinance a portfolio of two Marriott-flagged hotels in the Memphis, TN, submarket of Southaven, MS.
The financing is secured by an 85-key Courtyard by Marriott and an adjacent 78-key Residence Inn by Marriott. Both properties were developed in the mid-2000s by the sponsor, which has more than 50 years of combined hospitality experience. Proceeds from the three-year, non-recourse loan will be used to take out a maturing CMBS loan.
Despite the challenges of COVID-19, both properties performed extremely well during the pandemic. The Courtyard was closed during the initial three months of the pandemic, with customers directed to the Residence Inn. Once reopened in June 2020, the Courtyard has achieved a 94% occupancy rate, and both hotels have performed significantly above expected levels, according to Knighthead.
VICI Properties to provide financing to Great Wolf Resorts
VICI Properties Inc. has entered into a strategic arrangement with Great Wolf Resorts Inc., a Blackstone Real Estate portfolio company, whereby VICI may provide certain financing for the construction and development of Great Wolf Lodge resorts throughout the U.S.
As part of this arrangement, VICI has agreed to provide a $79.5 million mezzanine loan investment related to the development of the more than $250 million Great Wolf Lodge Mid-Atlantic project in Perryville, MD, which is expected to be completed by the summer of 2023. The mezzanine loan has an interest rate of 8% and an initial term of three years with two successive 12-month extension options subject to certain conditions. The investment is expected to be funded in accordance with a construction draw schedule.
In addition, pursuant to a non-binding letter agreement, VICI will have the opportunity for a period of up to five years to provide up to a total of $300 million of mezzanine financing for the development and construction of Great Wolf’s domestic and international indoor water park resort pipeline.