The 35 hotels, with a total of 6,943 rooms, are located across the country with 15 in California, six in Utah, three in Colorado, three in Arizona, three in Washington, three in Minnesota, one in Oregon and one in New Mexico.

The borrower is comprised of subsidiaries of Sunstone Hotel Investors LLC, based in San Clemente, CA. In 1999, the senior management of the former REIT Sunstone Hotel Investors Inc., and Westbrook Partners, a Boston-based real estate investment firm, completed a management buyout of the REIT and took the company private. Westbrook Partners LLC is the sponsor and general partner of four separate real estate funds with total aggregate equity capital of nearly $4 billion.

The transaction is the firm's largest single-borrower real estate financing deal to date, eclipsing a $395 million financing completed in 2001. "This transaction highlights the success of our real estate financing group in structuring large portfolio financings for sophisticated borrowers," says David Lauretti, managing director of the firm.

Babson says it closed the deal following a competitive bidding process. While the initial funding of the loan is $345 million, the transaction provides the borrower with options to earn out additional advances up to $399.5 million. The loan is for an initial term of four years with the option to extend for an additional year.

Babson, a subsidiary of Massachusetts Mutual Life Insurance Co, was founded in 1940 and is one of the oldest investment counsel firms in the US. The firm manages approximately $78 billion, primarily for institutional investors, and has offices in Cambridge as well as six additional offices around the country.