Eastdil, Meridian Secure $275M Hotel Financing

NEW YORK CITY-Morgan Stanley Mortgage Capital Holdings LLC has provided a 10-year CMBS loan for the fee position in the Milford Hotel, Eastdil Secured and Meridian Capital Group said Monday. The two firms negotiated $275 million in permanent financing on behalf of a partnership between David Werner and Deutsche Asset & Wealth Management's real estate investment business, an acquisition previously reported on GlobeSt.com.

Eastdil's Doug Harmon and Adam Spies, both senior managing directors, worked on the transaction, along with Meridian's Abe Hirsch, managing director, and Peter Steier, managing director and head of equity capital markets. According to a release, Morgan Stanley won the assignment amid heavy competition based on its ability to write a loan of this size and complexity as well as on speed and certainty of execution.

The new financing facilitates the acquisition of the fee interest in the hotel component of the 85-year-old Milford, located at 700 Eighth Ave. near Times Square, from a venture between Rockpoint Group and Highgate Holdings. It's subject to a new 99-year ground lease, according to Deutsche Asset & Wealth Management. Rockpoint and Highgate will continue to operate the 1,331-key hotel; the 26,000-square-foot retail component is held in separate ownership.

“We are pleased to add this high-quality investment to our client's portfolio,” Todd Henderson, head of real estate, Americas at Deutsche Asset & Wealth Management, in a release when the acquisition was announced earlier this month. “Acquiring the leased fee interest in a prime New York City location is expected to provide strong and durable long-term returns.”