Thank you for sharing!

Your article was successfully shared with the contacts you provided.

NEW YORK CITY-Lowering costs and extending the maturing dates up to five years, Morgans Hotel Group completed a $475-million recapitalization of all third-party corporate debt. Formerly known as Ian Schrager Hotels, the group is securing the refinancing through its upscale Hudson, Royalton, Morgans, each based here, the Mondrian in Los Angeles, and Miami’s Delano hotel sites.

“The completion of this financing is the last step in our program to strengthen the finances and foundation of the company,” says Ian Schrager, president of MHG. “With this behind us, we can now concentrate all of our energies on growing and further improving the business.”

Sonnenblick-Goldman Co. arranged the refinancing on behalf of Morgans and its partner, NorthStar Capital Investment Group. The financing was co-provided by RBS Greenwich Capital, Credit Suisse First Boston and Blackacre Capital Management.

“The execution of this transaction further underscores the industry’s continued belief in the long-term viability of the upscale boutique hotel sector,” states Mark J. Gordon, managing director and principal of Sonnenblick-Goldman, who worked on the transaction with senior associate Svetlin Ganchev. “The uniqueness of the asset base, combined with the positive trending cash flow and the irreplaceable locations, further contributed to the strong interest by the lending communities.”

Last month, MHG, which has interest in 10 hotels with 3,000 guestrooms, completed the sale of a 90% interest in its Paramount Hotel venture here for $128.5 million. Becker Ventures intends to rebrand the site as with the Hard Rock Café moniker. Prior to that, Morgans entered into a sale-leaseback transaction on its San Francisco Clift Hotel with affiliates of Divco West Properties, under which Divco will pay the firm $71 million and MHG will retain a 99-year leasehold.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 3 free articles* across the ALM subscription network every 30 days
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?


Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.