Deutsche Bank is understood to be the preferred party to lead the £300m refinancing, beating Citibank to the mandate. Eastdil Secured was appointed to search for a party to refinance the luxury hotel by its owners Saudi Prince Alwaleed’s Kingdom Hotel Investments and Lloyds Banking Group in July.
It is yet to be finalised whether Deutsche will be providing a senior loan of around £200m – a loan-to-value of around 55% on the asset – and to bring in a mezzanine provider for the remaining £100m junior tranche or whether Deutsche will provide a whole loan.
The deal will refinance an existing facility with Crédit Agricole CIB and DekaBank. The Savoy’s current margin is around 380-400 basis points but it is thought the new deal could mean a margin of less than 300 basis points.
All parties declined to comment.