Blackstone is close to closing a $950 million deal to refinance its historic Coronado Hotel in San Diego, real deal Learned.

Barclays is leading a program of commercial mortgage-backed securities that will be fully backed by the 757-room hotel at 1500 Orange Avenue, according to Trepp and a person familiar with the matter. Blackstone declined to comment.

The floating-rate, interest-only loan, which is expected to end later this month, has a loan-to-value ratio of about 60%, meaning the property is worth about $1.6 billion, according to Trepp.

“It’s an iconic building,” Alan Reay, who runs hotel brokerage Atlas Hospitality Group, said of the hotel. “Copying or rebuilding is impossible.”

Blackstone bought the 134-year-old Hotel Coronado, located at the southern tip of San Diego’s Coronado Peninsula, in 2015 as part of a $6 billion acquisition of Strategic Hotels and Resorts. Blackstone paid $600 million for the property, according to records.

A year later, Blackstone reached an agreement to sell the Coronado Hotel and its entire strategic portfolio to Anbang Insurance Group. However, U.S. regulators blocked the deal, prompting Blackstone to call off the deal.

In September, the investment firm completed a $400 million renovation of the property, adding 75 rooms.

The new financing will replace $508 million in senior mortgage debt and $204.4 million held in three mezzanine loans — all issued in 2017, according to a DBRS Morningstar ratings report.

The debt was packaged as a CMBS loan, which was due to mature in August, after Blackstone requested four deferrals.

According to data obtained by CMBS, the property will report approximately $68 million in net operating income by the end of 2022 TRDan increase of nearly 50% over 2019.

Hotels in resort markets such as Coronado, La Jolla and Santa Barbara have hit record highs over the past two years after pandemic-related travel restrictions eased, Reay said.

Blackstone has also dramatically increased average hotel room rates. Average revenue per room at hotels was $507 at the end of last year, up from $272 at the end of 2014, CMBS data showed.

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