Strategic Recaps Fairmont Scottsdale
- Jun 14, 2011
June 14, 2011
By Allison Landa, News Editor
Strategic Hotels & Resorts Inc. has closed a definitive agreement to recapitalize the Fairmont Scottsdale Princess hotel in Scottsdale, Az.
Per the agreement, a new joint venture has been created between the company and an affiliate of Walton Street Capital L.L.C., a private equity real estate investment firm. Both will serve as joint partners in the joint venture, with Strategic serving as managing member and continuing as the hotel’s existing asset manager.
The deal includes an amendment and extension of the existing CMBS first mortgage debt through Dec. 31, 2013, with the option for a second extension through April 9, 2015. It includes a $7 million principal payment to the CMBS first mortgage as well as other terms and conditions.
The joint venture will also invest in the development of a new 23,000-square-foot ballroom and adjoining meeting space at the hotel. The total transaction value lies between $71 and $73 million, with an anticipated investment of between $35.5 and $36.5 million for Strategic’s share.