Cantor Commercial Real Estate has provided a $33.3m loan to Ashford Hospitality Trust for the acquisition of the Marriott Memphis East in Memphis, Tennessee.
The two-year floating rate loan carries a 77% loan-to-value based on the $43.5m that the REIT paid for the 232-room hotel earlier this year. The 10-story hotel underwent extensive renovations in 2012 when it was converted from a Holiday Inn Select to a full-service Marriott.
“With the hotel’s recent conversion to a full service Marriott, it has virtually no ‘capex’ needs,” said Monty Bennett, Ashford’s chairman and CEO, referring to future capital expenditures. “After the installation of our affiliated property manager, Remington Lodging, we expect to achieve continued solid increases in RevPAR penetration as the property stabilizes.”
The hotel, at 5795 Poplar Avenue, is a short drive from the Graceland Mansion, Elvis Presley’s former abode, and historic downtown Memphis. Guestrooms average 307 sq ft and amenities include a fitness center, business center, indoor pool and whirlpool, 9,000 sq ft of meeting space and full-service restaurant Table – A Delta Grille.
“This transaction was particularly attractive given the hotel’s prime location and market attributes, which include no new competitive supply projected for the submarket and stable corporate demand generators,” Bennett added.
Ashford invests in opportunistic hospitality assets across the US, while CCRE originates fixed and floating rate mortgages and mezzanine loans. The lender is capitalized by institutional sponsorship including affiliates of CIM Group and Cantor Fitzgerald. HFF arranged the financing.