A major Property Improvement Plan (PIP), expected to cost $2 million, will be completed by the new owner in a “staged” format to minimize off-line rooms and target room renovations during slack periods. The property was sold by Hospitality Investors Trust (HIT), which is a non-traded hotel REIT. HIT was not interested in completing the PIP, and as a result, performance has trended down in recent years amid new supply and lack of investment in the property.

“The transaction was challenging because property performance continues to deteriorate,” said Michael Sneden, Executive Vice President at ValueXpress. “We presented a thorough business plan to the chief credit officer with specific areas of operating cost savings and a marketing plan to stabilize sales during the completion of the PIP, with a strategy to move ADR on completion of the PIP.” The plan was well received, and the loan was approved and closed within the contract period.

To get a free, no-obligation quote for your hotel CMBS conduit loan, contact a member of the ValueXpress team: Mike Sneden (mikes@valuexpress.com), or Gary Unkel (gunkel@valuexpress.com).

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The hotel is located off I-40, 23 miles from Petrified Forest National Park and is the closest nationally franchised hotel to the park. Named for its large deposits of petrified wood, the park covers about 346 square miles, encompassing semi-desert shrub steppe as well as highly eroded and colorful badlands. The park receives over 600,000 visitors annually.

The transaction was challenged by the remote location of Holbrook, which has a population of only 5,000. To mitigate the concern, ValueXpress provided substantial information on the popularity of the park and supported the hotel’s location on “Historic Route 66” as a popular leisure travel route supporting strong demand for rooms.

This was a first-time CMBS loan for this client, and as with all new and existing clients, ValueXpress guided the client through each step of the process, resulting in a close six weeks from application. The loan was originated by Michael D. Sneden, Executive Vice President at ValueXpress. For your next hotel loan, contact Mike at 212-883-6447 (mikes@valuexpress.com).

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The property is located off I-20, south of Jackson, Mississippi. Area attractions include Trustmark Park, the Jackson Convention Complex, and the Mississippi Museum of Natural Science. The hotel was constructed to Hilton’s “Forever Young” program initiative, which includes the “Perfect Mix” lobby and “Jumpstart” Fitness Center. The hotel is a high performer, earning a number-one ranking on TripAdvisor and achieving a 109% RevPAR penetration rate.

The loan was originated by Jay Bhakta, Senior Loan Originator, and Mike Sneden, Executive Vice President at ValueXpress. For your next hotel loan, contact Mike at 212-883-6447 (mikes@valuexpress.com) or Jay at 601-918-2850 (jayb@valuexpress.com).

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In 2020, a major Property Improvement Plan (PIP), expected to cost $2 million, will be completed by the new owner in a “staged” format to minimize off-line rooms and to target room renovations during slack periods. The property was sold by Hospitality Investors Trust (HIT). HIT is a non-traded hotel REIT that was not interested in completing the PIP, and as a result, performance has trended down in recent years amid new supply and lack of investment in the property.

“The transaction was challenging because property performance continues to deteriorate,” said Michael Sneden, Executive Vice President at ValueXpress. “We presented a thorough business plan to the chief credit officer with specific areas of operating cost savings and a marketing plan to stabilize sales during the completion of the PIP, with a strategy to move ADR on completion of the PIP.” The plan was well received, and the loan was approved and closed within the contract period.

To get a free, no-obligation quote for your hotel CMBS conduit loan, contact a member of the ValueXpress team: Mike Sneden (mikes@valuexpress.com), Dennis Suh (dsuh@valuexpress.com) or Gary Unkel (gunkel@valuexpress.com).

The post ValueXpress Obtains $4.05-Million CMBS Conduit Loan for the Purchase of a Homewood Suites Limited Service Hotel in Ridgeland (Jackson), MS appeared first on VALUEXPRESS - Commercial Mortgage Loans.

The property is located off I-20, south of Jackson, Mississippi. Area attractions include Trustmark Park, the Jackson Convention Complex, and the Mississippi Museum of Natural Science. The hotel was constructed to Hilton’s “Forever Young” program initiative, which includes the “Perfect Mix” lobby and “Jumpstart” Fitness Center. The hotel is a high performer, earning a number-one ranking on TripAdvisor and achieving a 109% RevPAR penetration rate.

The loan was arranged by Jay Bhakta, Senior Loan Originator in the ValueXpress Jackson, Mississippi office. Jay has a long-standing relationship with the client and handles all their financing needs. For your next hotel loan, contact Jay at (601) 708-1000 or send him an email at jayb@valuexpress.com.

The post ValueXpress Obtains $5.5-Million CMBS Conduit Loan for the Refinance of a 78-Room Hampton Inn & Suites in Richland, MS appeared first on VALUEXPRESS - Commercial Mortgage Loans.

To meet its plan to double the number of Country Inn & Suites hotels in Radisson Hotel Group’s inventory, the company is revving up the Gen 4 redesign program. It will offer loans to owners who cannot find financing for the upgrades through conventional lenders. The company will also end licensing contracts with owners who do not take part in the Gen 4 property improvement plan.

“When I came on board, and we set up the five-year strategic plan, we actually thought there were a whole bunch of Gen 1s, well over 50, that were going to have to exit the system, that just did not financially pencil in. They’re smaller properties, under 60 rooms, that would not be able to move to Gen 4,” said Ken Greene, president, Americas, for Radisson Hotel Group

“But some of those owners with Gen 1 properties said, ‘We think we can do it … in a cost-effective way.’ My internal team at the time said, ‘No way. Can’t do it.’ ”

“We went out there, sat with them and looked at what they were doing, and we said, ‘Darn right, it can work.’ We didn’t have to ask those properties to leave. Many of them have been converted over to Gen 4 very successfully.”

ValueXpress has been active in refinancing Country Inn & Suites hotels to provide “cash-out” proceeds to fund Gen 4 conversions. To obtain a “cash-out” loan to pay for your Gen 4 conversion, contact Mike Sneden (mikes@valuexpress.com), Dennis Suh (dsuh@valuexpress.com) or Gary Unkel (gunkel@valuexpress.com).

The post 9.13.19: Country Inn & Suites Gen 4 Transition Update appeared first on VALUEXPRESS - Commercial Mortgage Loans.

Primary guest demand arises from the airport. The airport serves over 40 million passengers annually and is a hub for two airlines — American and Southwest. The hotel provides free shuttle service to the airport. Other amenities include a complimentary hot breakfast, free Wi-Fi and a heated outdoor pool. Leisure activities in the area include Talking Stick Resort Arena, the Phoenix Zoo, Papago Park, Tempe Town Lake and Arizona State University

“The CMBS loan provided significant cash-out equity proceeds to the sponsor. Part of the cash-out proceeds will fund a Property Improvement Plan (PIP) in conjunction with a long-term franchise renewal with Choice Hotels,” commented Michael D. Sneden, Executive Vice President at ValueXpress. “In addition, the new loan features a 10-year, fixed-rate term with an interest rate in the mid-4% area, which was lower than the existing loan rate, providing significant interest savings to the sponsor.”

For your next hotel financing, contact Mike at mikes@valuexpress.com.

The post ValueXpress Arranges $6,500,000 CMBS Conduit Loan for the Refinance of a Comfort Suites in Tempe (Phoenix), AZ appeared first on VALUEXPRESS - Commercial Mortgage Loans.

The hotel is located at the northern most point of Michigan’s Lower Peninsula along the shore of the Straits of Mackinac. Mackinaw City sits at the southern end of the Mackinac Bridge that leads to Michigan’s Upper Peninsula. The Lower and Upper Peninsulas are connected by the 8,614-foot Mackinac Bridge. It is at this location where Lake Huron, to the east, and Lake Michigan, to the west, meet.

The primary demand for the hotel is tourism. Mackinaw City is a vacation destination that accommodates over 1.2 million visitors a year. Tourism is the largest employment and economic sector in the region.

“The CMBS loan paid off a high-cost, recourse SBA 7(a) loan that was floating rate,” commented Michael D. Sneden, Executive Vice President at ValueXpress. “The new loan features a 10-year, fixed-rate term with an interest rate under 5%, providing significant savings to the sponsor.”

The transaction was challenging as the property is closed for six months during the winter. To ensure enough funds will be available to pay the mortgage, escrows and operating expenses during the winter, a seasonality reserve was structured: Payments are applied automatically by the servicer during the winter months and the reserve is re-filled during the summer months.

For your next hotel financing, contact Mike at mikes@valuexpress.com.

The post ValueXpress Arranges $3,250,000 CMBS Conduit Loan for the Refinance of a Baymont Inn and Suites in Mackinaw City, MI appeared first on VALUEXPRESS - Commercial Mortgage Loans.

College Station is home to the main campus of Texas A&M University, the flagship institution of the Texas A&M University system. Due largely to the presence of Texas A&M University, in 2006, College Station was named by Money magazine as the most educated city in Texas and the 11th most educated city in the United States. In the fall 2013 semester, Texas A&M was the fourth-largest U.S. university with an enrollment of 56,255 students pursuing degrees in ten academic colleges.

“The loan was a challenge as the transaction returned all the sponsor’s equity and then some,” explained Jay Bhakta, a Senior Loan Originator at the ValueXpress Jackson, Mississippi office and 15-year ValueXpress veteran. “But we were able to show that the high quality of construction to levels well in excess of brand standard plus the strong demand in the College Station market mitigated the cash-out risk.”

The post ValueXpress Arranges $4.76-Million CMBS Conduit Loan for the Refinance of 62-Room Quality Inn and Suites Hotel Located in Bryan, TX appeared first on VALUEXPRESS - Commercial Mortgage Loans.

The up-front cost to develop an “office suite” building is typically higher than a traditional open floorplate because of the additional walls, doors and internal wiring involved in the build-out. Furniture is an additional cost for developers who provide the suites furnished. Building owners are able to charge higher rent/square foot for office suites. One reason is the rent is typically quoted per week or per month, similar to a residential apartment, and although when converted to rent/square foot the amount looks high, on a rent/month basis, the rent is appealing. For example, the rent on a 180-square-foot furnished office suite in a suburban market in the southeast might be $600/month, which sounds quite reasonable, and it converts to $40/square foot, which is much higher than the $20/square foot charged for larger, traditional office space.

As larger corporations downsize their centralized office space and shift employees into “the field” to be closer to clients, the “office suite” niche should continue to grow.

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