IH Capital has provided $236.75 in financing for seven lifestyle hotels owned and operated by Portland, Oregon-based Provenance Hotels.
Six of the properties were refinanced with 10-year, fixed rate, non-recourse debt (and not cross-collateralized). Sonnenblick-Eichner Company arranged the financing, as well as the previous loans on the assets.
The assets — including the Hotel Lucia, Hotel deLuxe, Sentinel and Westin Portland in Portland, Oregon, the Hotel Max in Seattle Washington, and the Hotel Preston in Nashville, Tennessee — were then purchased by the newly-launched $525 million Provenance Hotel Partners Fund I through a roll-up with existing ownership partners.
Sonnenblick-Eichner Company principal Elliot Eichner noted that 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.”
The financing of the seventh hotel, the Roosevelt Hotel located in Seattle, Washington, was a non-recourse, LIBOR-based facility that Provenance Hotels used to acquire its partners’ equity interest and fund an upcoming renovation and repositioning.
As reported last week, Sonnenblick-Eichner Company recently arranged $65.2 million in loans provided by American International Group for the the refinancing of two Hyatt-branded properties: the 149-room Hyatt House Seattle/Redmond and the 160-room Hyatt House Seattle/Bellevue, Washington.
IH Capital, formed in late 2014, is a joint venture between BNY Mellon and Iron Hound Management Co., an investment and brokerage firm established by former Wachovia executive Robert Verrone.