Sonnenblick-Eichner Lines Up $92M Refi for Hotel Portfolio

Working on behalf of LodgeWorks, the firm has secured funds for two Hyatt House properties, a Hilton Garden Inn and a boutique Archer Hotel.

Beverly Hills, Calif.—Sonnenblick-Eichner Co. has arranged $92 million in first mortgage debt to refinance a portfolio of four hotels totaling 592 guestrooms, the company announced late last week. The portfolio comprises two Hyatt House–flagged properties on the East Cost; a Hilton Garden Inn in Albany, N.Y.; and a luxury boutique Archer Hotel in Austin, Texas.

Hyatt House in Falls Church, Va.

Hyatt House in Falls Church, Va.

The financing consisted of four separate non-recourse, non–cross-collateralized loans from three different lenders. Sonnenblick-Eichner arranged for a money center commercial bank to provide 10-year fixed rate financing on each of the two Hyatt House properties, and LIBOR-based floating rate financing from two regional banks on the Archer and Hilton Garden Inn properties.

A Sonnenblick-Eichner spokesperson was not permitted to disclose the lenders’ or the borrower’s identities, but Commercial Property Executive was able to independently confirm that the hotels’ owner-operator is LodgeWorks Partners LP, of Wichita, Kan.

A privately held hotel development and management company, LodgeWorks launched the Archer Hotel brand in May 2014 with a property in Midtown Manhattan. Two further Archer hotels, in Napa, Calif., and Florham Park, N.J., are scheduled to open next year.

The four hotels are:

  • Archer Hotel Austin, Austin, Texas (171 guestrooms);
  • Hyatt House Falls Church/Merrifield, Falls Church, Va. (148 guestrooms);
  • Hyatt House Philadelphia/King of Prussia, King of Prussia, Pa. (147 guestrooms); and
  • Hilton Garden Inn Albany/SUNY, Albany, N.Y. (126 guestrooms).

“The financings were all competitively bid,” Sonnenblick-Eichner Principal Elliot Eichner said in a prepared statement. “The recently completed Archer Austin closed with only three months of operational history. The loan also provided for an earn-out allowing the borrower an opportunity to increase loan proceeds as the property ramps up.”

“The various financing structures met our client’s expectations in terms of locking in advantageous long-term fixed rates on two of the assets, and a flexible LIBOR-based facility on the other properties,” Patrick Brown, also a Sonnenblick-Eichner Principal, added.

Sonnenblick-Eichner specializes in arranging structured finance for acquisition, construction and permanent loans, interim and mezzanine financing, as well as joint-venture equity transactions.