BEVERLY HILLS, CA—Oregon-based Provenance Hotels got a multimillion-dollar infusion for seven of its owned and operated properties thanks to $236,750,000 of first-mortgage financing arranged by Sonnenblick-Eichner Co., based here, Hotel Business has learned.
The lifestyle hotels, representing an aggregate 1,072 rooms, are located in Portland, OR; Seattle; and Nashville, TN.
Commenting on the financing, Elliot Eichner, a principal of Sonnenblick-Eichner Co., said, “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.”
Six of the properties received 10-year, fixed-rate loans, all non-recourse and not cross-collateralized. These include Hotel Lucia, Hotel deLuxe, the Westin Portland, and Sentinel, all in Portland; Hotel Max in Seattle; and Hotel Preston in 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 property, the Roosevelt Hotel in Seattle, was a non-recourse, LIBOR-based facility that Provenance Hotels used to acquire its partners’ equity interest, as well as a planned renovation and repositioning of the hotel.
“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,” added Patrick Brown, also a principal of Sonnenblick-Eichner Co.
In addition to the financed portfolio, Provenance Hotels manages Hotel 1000 in Seattle and Hotel Murano in Tacoma, WA, and the Old No. 77 Hotel & Chandlery in New Orleans.
—Stefani C. O’Connor