Hall Financial Stakes Six Hotels, One Seniors Facility to $12.4M

Hotel Venture Ltd., an affiliate of Circa Capital Corp., has collateralized a $7.85-million, five-year loan with two hotels in Lubbock, TX and one each in Fort Smith, AR, Cheyenne, WY, Billings, MT and Fresno, CA. To date, it's the largest deal consummated under Hall Financial's program to provide gap and bridge financing for real estate assets.The borrower used the capital infusion to restructure and buy out an existing partner, whose identity is being kept under wraps. The hotels, built between 1998-99, total 1,519 rooms and carry an estimated assessed value of $60 million.

With hotel lending practically nil in today's market, it was a case of borrower and lender connecting via "a mutual acquaintance," Larry Levey, Hall's executive vice president, tells GlobeSt.com. He confides that more hotel deals are in the works. The portfolio "had a good solid cash flow," Levey explains, "and consistent performance over the last 12 months."

Dallas-based Trimark Realty Investments Inc. secured a $4.55-million refinancing for two years to buy time to boost occupancy from 30% at the 140-unit Mesa Palms Retirement Community at 1418 N. Country Club Dr. in Mesa, AZ, Levey says. Hall did not take an equity interest that property, which opened in March 1999. It, like the hotel portfolio, is a "sound" real estate asset with a "quality" operator, according to Levey.

To date this year, Hall Financial closed five loans totaling $20 million from the $100-million coffer set up to float mezzanine debt and equity investment. In exchange for cash, the borrower relinquishes up to 25% interest. The program, launched in January, primarily focuses on hotel investments.