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ALBUQUERQUE-American Property Management Corp. has secured $23.2 million to pay off an 18-month-old acquisition loan for the former 276-room Wyndham Albuquerque Airport Hotel. About $7.5 million will be used for upgrades so the hotel can be operated under the Sheraton flag.

When American Property Management Corp. acquired the hotel at 2910 Yale Blvd. SE in early 2007, the owners immediately wanted to operate it as a Sheraton. “They didn’t get the renovation plan completed in time so they decided to drop the Wyndham franchise. While they’ve been developing the renovation plan, the hotel has been operating as an independent,” says Michael D. Armstrong, president of San Diego-based Neptune Hospitality Advisors.

Armstrong says the owner is upgrading interiors to take the hotel up to the Sheraton’s design standards. “They’re not moving walls,” he adds. “The property’s in good shape.” Upgrades have just begun and should be completed by first quarter 2009.

Even with a renovation plan and a pending new brand, Armstrong acknowledges to GlobeSt.com that finding financing was tough, especially given current economic times. He says what helped, however, was the owner’s strong reputation and the fact the hotel is in a well-traveled location near the airport. In addition, he says the hotel’s cash flow has been outstanding, even while being operated as an independent. The hotel’s occupancy is just shy of 80%, with the average daily room rate falling between $75 and $80.

Armstrong arranged a five-year loan through a national lender, getting a variable interest rate of 400 to 500 basis points over Libor. The 70% loan-to-cost financing has 12 months of interest-only payments.

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