The loan is fixed at 14% after that. Loan payments are interest-onlythroughout the seven-year term. Ashford receives an origination fee of 1%. The mezzanine loan may be prepaid at any time subject to a pre-payment penalty.
"The Westin Westminster is a well-positioned property with a very solid brand and the highest quality rooms in the market," says Monty J. Bennett, president and chief executive officer of Ashford. He says the loan is an example of an attractive yield with a "strong credit" asset, "while at the same time keeping our investment at relatively low loan-to-value levels." He also notes that Ashford offered four different transaction alternatives to meet Inland Pacific's needs.
Financing on The Westin Westminster includes a first mortgage of $30.5million by CIBC and the $11-million mezzanine loan originated byAshford. Ashford's mezzanine loan represents between 57% and 78% ofthe borrower's capital structure. The trailing 12-month debt servicecoverage ratio for the entire loan is 1.30.
The 14-story, 369-room Westin opened in April 2000 and is located halfway between Downtown Denver and Boulder on the Boulder turnpike. It is approximately five miles from Interlocken Advanced Technology Business Park, home to Sun Microsystems, Avaya Communications, Level 3 Communications and StorageTek. The hotel is also near a number of retail shops, theaters, restaurants, golf courses and a large ice arena.
The hotel complex includes a 35,694-sf conference center and 4,800-sf pavilion that are leased from the city of Westminster along with approximately 30,000 sf of additional exterior meeting space overlooking a lake and the Rocky Mountains. Starwood Hotels & Resorts manages the property.
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