Colony Capital finances emerging markets residential developer

Colony Capital has provided a €40.4m facility to Dolphin Capital Investors, a residential resort developer in emerging market.

The Los Angeles-based private equity firm has entered an agreement with Dolphin Capital for a six year facility that has a fixed 11% rate. On top of this, Colony will receive income from its Amanzoe development near Porto Heli, Peloponnese. It will receive 100% of the income from the development until the annual interest on the facility is paid, 64% until the facility is repaid and 25% up to Colony’s total internal rate of return hits 16%.

Of the €40.4m, €10m will be used to repay a deposit owed to Archimedia, an investor which is no longer involved in the Greek scheme because of Dolphin’s agreement with Colony. A further €9m will be used for acquiring additional land, constructing villas and expanding the beach club at Amanzoe. The remainder will be used for general corporate purposes and the development of other projects. The facility has no recourse or guarantee from Dolphin.

The luxury resort hotel and villa complex is made up of 38 pavilions and four beach cabanas, spa, a beach club and “a collection of villas”. Dolphin Capital said that despite the depressed Greek market the project was expected to make an operating profit in 2014 from the hotel operations and villa sales.