Stonehill closed $100 million in CPACE loans in fourth quarter

STONEHILL, AN AFFILIATE of Peachtree Hotel Group, closed on $100 million Commercial Property Assessed Clean Energy loans for nine properties during the fourth quarter. The company expects to close on an additional $80 million in CPACE financing within 90 days.

Peachtree Hotel Group heads Jatin Desai and Mitul Patel are principals of Stonehill and members of the company’s investment committee. Brent LeBlanc is the company’s executive vice president.

The CPACE loans provide liquidity hotel owners need to address shortfalls created by the COVID-19 pandemic and maintain their assets, LeBlanc said.

“Since the early stages of the pandemic back in April, Stonehill has provided CPACE financing to a variety of hoteliers whose projects otherwise would have been either stalled or cancelled,” he said. “With far lower interest rates than traditional loans, we believe this type of financing will prove invaluable as hoteliers battle through what hopefully are the closing stages of the coronavirus.”

Recipients of the recent CPACE loans include:

• The 315- Room Citizen M Los Angeles received the second largest C-PACE transaction ever for the hotel. The retroactive funding went to recoup capital spent on energy improvements for the recently built modular construction project.
• The 145-Room Vista Collina Resort Napa loan will allow ownership to pay off a mezzanine loan and cover interest and operating reserves through year-end.
• The 105-Suites Hilton Garden Inn in Longmont, Colorado, with construction nearly complete, will use the CPACE loan to cover interest and operating reserves as the hotel ramps up.
• Owners of the 174-Room Tapestry Suncoast Hotel in Anaheim, California, approached Stonehill looking for liquidity after the shutdown of Disneyland and other events in that market. The CPACE loan gave them the required flexibility to get through and ramp up cash flow, with proceeds used for interest, operating, and tax/insurance reserves.

“CPACE funding has proven to be an invaluable lifeline for struggling hoteliers,” said Jared Schlosser, vice president at Stonehill.  “Stonehill PACE’s team members have completed more than 40 deals totaling $225 million collectively.  This experience allows us to work quickly and strategically with owners to procure funds that have become more necessary now than ever as the hospitality industry continues to work through the pandemic.”

Last year, Stonehill assisted in Gulf Breeze, Florida-based Innisfree Hotels’ debt restructuring for its Hampton Inn & Suites Panama City Beach in Panama City, Florida.