Condo Converter Buys Mainstay Suites for $10M

KISSIMMEE, FL-Mainstay Suites, a 144-unit, 19-building property five miles from the entrance to Walt Disney World, has been sold by Orlando-based Lake Cecile Suites Associates LLP to condo converter Thomas Hayes and his Palm Suites Land Trust of here. The 20-year-old property traded for $10.06 million or about $69,861 per suite.

Area hotel brokers tell GlobeSt.com that current hard construction costs are estimated at about $150 per sf for a comparable property. Hayes is a principal in Hayes Reid Development Group Inc. based in Celebration.

Kennedy Funding of Hackensack, NJ is providing a three-year, $9.6-million acquisition loan to the buyer. The funding package has a loan-to-value factor of 65% and carries an interest rate of 12% in the first year; 15% in the second year; and 18% in the third year.

The eight-acre property is comprised of 14 buildings fronting the property; five buildings in the rear; a pool playground, dock and a pad site that can accommodate 16 additional condominium units. Facing Lake Cecile at 4786 W. Irlo Bronson Highway (US 192), Mainstay Suites has been renamed Palms Suites Lakeside. Hotel Condo Services LLC manages the property which is schedule to undergo a $3-million renovation.

Kevin Wolfer, a co-CEO at Kennedy Funding, says the loan was made to Hayes because of his quick repayment of a previous $4-million bridge loan to purchase the former 156-unit Palms Hotel and Villas, also known as Parkway Palms Resort, another hotel-to-condo conversion four miles east of Mainstay Suites and 1.5 miles from Disney’s front door. Hayes put $2.5 million in renovating that property.

“We still did our feasibility study but knowing the principals involved went a long way towards sealing our commitment” on the $9.6-million loan, Wolfer says in a prepared statement.