Raffles Boston Back Bay Hotel Project Secures $314M Construction Loan

BOSTON—Madison Realty Capital is providing $314 million in construction financing for the development of the first Raffles hotel project in North America—the Raffles Back Bay Hotel & Residences here.

The 33-story mixed-use project at 40 Trinity Place in Boston’s Back Bay upon completion will feature 147 hotel rooms and 146 residential units, as well as multiple amenities and dining options.

The transaction marks the entrance into the Boston market for both Cain International, which is headquartered in London, and New York City-based Madison Realty Capital. The total capitalization of the Raffles Back Bay Hotel & Residences project has been estimated at approximately $400 million.

The Raffles Boston Back Bay Hotel & Residences, which was first announced in April 2018, is the first announced Raffles-branded hotel and residential property in the United States.

Cain International will provide the majority of the equity to develop the property. Cain has entered into a joint venture with Trinity Stuart LLC, a partnership between two Boston entities: hoteliers Gary and Jeffrey Saunders of Saunders Hotel Group and developer Jordan Warshaw of The Noannet Group.

Riaz Cassum and Anthony Cutone of JLL (formerly HFF) arranged for both the equity and debt financing from Cain International and Madison Realty Capital.

“We are thrilled to be entering the Boston market with such a premier hospitality brand and fantastic partners who have been long time contributors to the development of this great city,” says Jonathan Goldstein, CEO of Cain International. “We look forward to bringing a best-in-class property to the Back Bay that seeks to not only meet but exceeds the expectations of today’s consumers.”

“This transaction offered MRC the opportunity to finance the construction of a marquee hospitality and residential asset with exceptional ownership and we are pleased to have delivered a solution tailored to the sponsor’s needs,” said Josh Zegen, co-founder and managing principal at MRC.

He adds, “This also represents our first Boston deal and the fact that it’s a substantial loan for an irreplaceable, transformative property in the market is emblematic of our growing reputation as a national lender with the ability to underwrite large transactions and quickly deliver the necessary financing.”

The financing MRC is providing will retire the existing debt on the property. The transaction comes on the heels of several substantial financing transactions Madison Realty Capital has closed, including a recent $225-million construction loan on The Residences at Mandarin Oriental luxury condominium tower in Boca Raton, FL.

Cain International notes it has made an equity investment in the Waldorf Astoria Beverly Hills, The Beverly Hilton Hotel and the adjacent land at 9900 Wilshire Boulevard is to be developed under a single master plan designed by Lord Norman Foster. The firm has also provided financing to advance the development of Aman Hotel & Residences in New York City’s historic Crown Building.

Cain International’s other U.S. investments include a portfolio in Miami including the development of the luxury residence towers Missoni Baia and Una and a new office development at 830 Brickell. Cain International has also backed The St. James, a sports, wellness and active lifestyle business, which opened its first flagship location outside of Washington DC and has announced its second location outside of Chicago. Last year, the group divested its stake in hotel group sbe Entertainment to Accor S.A., the parent company of Raffles.