"While we have remained active seekers of hotel assets in the past year, the gap between the expectations of buyers and sellers has remained too wide," says CEO Laurence S. Geller. "However, the gap is beginning to narrow, which should facilitate our search for attractively priced luxury properties with upside potential that can benefit from our style of aggressive asset management."
Deutsche Bank provided $910 million through a commercial mortgage-backed securities offering plus a $260-million mezzanine loan. Strategic Hotel Capital put up 15 of its US properties as collateral for the loan, which has a two-year term with three one-year extensions.
Various domestic and European life companies, banks, pension funds and money managers bought an investment-grade CMBS traunch. US life insurance companies provided two other mortgage loans. The mezzanine loan was placed with a Deutsche Bank affiliate and a major overseas institutional investor.
"Strategic represents a unique and compelling combination of world class real estate, proven management and a well-defined long-term business plan," says Jon Vaccaro, Deutsche Bank's global head of real estate debt.
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