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Acquisitions & Hotel Openings

Thorofare Capital Funds $11.25M Loan for Acquisition of Historic Hotel in Los Angeles' Westwood Village

LOS ANGELES, CA. April 27, 2017 - Thorofare Capital has provided West Hollywood, CA-based Shamina Investments with a $11.25 million floating-rate whole loan for its acquisition and renovation of the 53-room Claremont Hotel Westwood in Los Angeles’ upscale Westwood neighborhood.

The Claremont is located at 1044 Tiverton Avenue in Westwood Village, an historic commercial, entertainment and shopping district adjacent to UCLA in West Los Angeles. The seller, a local family, has owned the property since they built it in 1939. It was the first and currently remains the oldest hotel in Westwood.

A portion of the loan proceeds will go towards an extensive renovation that will include upgrades to all guest rooms, common areas, lobby and exterior. When renovations are completed, Shamina Investments will re-open the hotel in February 2018 as the Palihotel Westwood under the Paligroup hotel flag. Paligroup currently manages and operates four daily and extended stay boutique properties in the Los Angeles area.

The five-year, non-recourse loan was priced at a competitive spread over the 30-day LIBOR and includes structure for reserves to cover renovation costs, debt service and operating deficits prior to stabilization, according to Thorofare Capital Principal Felix Gutnikov who originated the financing.

Paligroup is a fully integrated branded real estate development and hospitality operating company that acquires, programs, develops, owns, and operates unique hotels and residences. Its proprietary brands, development and operational expertise also includes specialized retail spaces, highly curated restaurants, bars and event venues.

The loan was arranged by the New York City office of Mission Capital Advisors LLC.

About Thorofare Capital

Thorofare Capital, Inc. (www.thorofarecapital.com) focuses on originating senior mortgage debt solutions to borrowers seeking to opportunistically purchase or recapitalize middle market commercial real estate assets throughout the United States. Through Thorofare’s two types of lending programs – Fixed Rate Bridge Loans and Floating Rate Whole Loans – it directly originates secured first mortgage positions from $3,000,000 to $40,000,000 on commercial cash-flowing assets across the country. Thorofare, LLC is an SEC-registered alternative investment manager that specializes in managing the Fixed Rate Bridge Loans with its private fund vehicles. Thorofare has originated more than $1 billion of assets in its series of private fund vehicles and institutional accounts. Thorofare’s investors include family offices, foundations, wealth managers, institutional accounts and high net worth individuals.

Contact:
Bruce Beck
bruce@dbrpr.com
(805) 777-7971

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Feature Focus
Hotel Law: Issues & Events
There is not a single area of a hotel’s operation that isn’t touched by some aspect of the law. Hotels and management companies employ an army of lawyers to advise and, if necessary, litigate issues which arise in the course of conducting their business. These lawyers typically specialize in specific areas of the law – real estate, construction, development, leasing, liability, franchising, food & beverage, human resources, environmental, insurance, taxes and more. In addition, issues and events can occur within the industry that have a major impact on the whole, and can spur further legal activity. One event which is certain to cause repercussions is Marriott International’s acquisition of Starwood Hotels and Resorts Worldwide. This newly combined company is now the largest hotel company in the world, encompassing 30 hotel brands, 5,500 hotels under management, and 1.1 million hotel rooms worldwide. In the hospitality industry, scale is particularly important – the most profitable companies are those with the most rooms in the most locations. As a result, this mega- transaction is likely to provoke an increase in Mergers & Acquisitions industry-wide. Many experts believe other larger hotel companies will now join forces with smaller operators to avoid being outpaced in the market. Companies that had not previously considered consolidation are now more likely to do so. Another legal issue facing the industry is the regulation of alternative lodging companies such as Airbnb and other firms that offer private, short-term rentals. Cities like San Francisco, Los Angeles and Santa Monica are at the forefront of efforts to legalize and control short-term rentals. However, those cities are finding it’s much easier to adopt regulations on short-term rentals than it is to actually enforce them. The December issue of Hotel Business Review will examine these and other critical issues pertaining to hotel law and how some companies are adapting to them.