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Case Study

Acquisition Financing - King & Grove New York

​Jones Lang LaSalle's Hotels & Hospitality Group was hired by a prominent local New York City investor / developer / management group to secure first mortgage financing to facilitate the acquisition and repositioning of the former Hotel LOLA.

The sponsor, who was under agreement to purchase the property, sought funding of the requested loan to occur simultaneously with the closing of the acquisition.
In connection with the sale of the property, the seller was to provide a fully-subordinate $20.0 million mezzanine loan.
 
The property is a recently renovated 276-room boutique hotel located immediately off of Madison Avenue between 29th and 30th Street in the vibrant Madison Square Park neighborhood of Midtown Manhattan.
 
From 2001 through 2011, previous ownership completed $40.7 million ($147,650 per key) of capital improvements to the property, including a $13.7 million renovation completed in October 2011.
 
The sponsor’s strategic business plan, which included a conversion of approximately 9,000 square-feet of retail space into a restaurant and lounge, is expected to yield a net operating income of $16.6 million in year five of operation.
 
The team secured a $65.0 million senior mortgage loan from an institutional debt fund. The loan was funded in June 2012, allowing the sponsor to close on the acquisition in accordance with the timing requirements of the purchase and sale agreement.
 
For more information please contact Mathew Comfort, 001 212 812 5871.

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