MCR, BLT close on $632M refinance for 53-hotel portfolio

NEW YORK — New York City-based MCR and Stamford, Connecticut-based Building and Land Technology (BLT) have closed $632 million, three-year, fixed-rate financing on a portfolio of 53 hotels across the U.S. The loan was securitized in a single-asset, single-borrower CMBS SASB transaction, with the entire portfolio valued at $960 million.

The portfolio of hotels, including 33 Marriotts and 20 Hiltons, totals 5,958 rooms and was acquired by MCR and BLT between 2013 and 2015. They are spread out across 14 states, including Texas, Arizona, Virginia and North Carolina. Collectively, over $118 million of capital expenditures have been invested in the portfolio.

At closing, the 53 hotels had over $64 million of net operating income (NOI) on a trailing 12-month basis, up from $55 million NOI in 2021.

It is a great achievement to accomplish a refinancing of this size and scope in today’s challenging debt environment. Pricing on the bonds was strong with our AAA’s coming in at +145. This deal is a great outcome for our partnership.

Carl Kuehner

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“This refinancing is a validation of the quality of assets in the portfolio and the attractive operating and financial performance of properties managed by MCR,” said MCR Chairman and CEO Tyler Morse.

The portfolio includes eight Marriott and Hilton extended-stay and select-service brands, including Residence Inn by Marriott, Courtyard by Marriott, TownePlace Suites by Marriott, Hilton Garden Inn and Hampton Inn by Hilton.

 “It is a great achievement to accomplish a refinancing of this size and scope in today’s challenging debt environment. Pricing on the bonds was strong with our AAA’s coming in at +145. This deal is a great outcome for our partnership,” said BLT Chairman Carl Kuehner.

Citigroup Global Markets managed and acted as bookrunner on the transaction, while Eastdil Secured LLC advised MCR and BLT. Fried, Frank, Harris, Shriver & Jacobson LLP served as legal advisor.

Last week, Atlanta-based Access Point Financial (APF) announced it had closed on a $90 million investment that was part of the overall refinance in the company’s first SASB transaction. APF’s piece was the capital stack’s last two controlling bond tranches.

APF CEO and Chairman Michael Lipson told Hotel Investment Today that similar deals could be on the horizon for the company. 

“We will continue to work with the different participants on the Street. We’re talking to several others right now,” he said. “We think there’s a couple of potential deals out there that we definitely have an interest in.”

In February, MCR refinanced a 16-hotel portfolio for $333 million, the proceeds of which will net $51 million. Those hotels were acquired primarily in 2020 and 2021, and the portfolio has 2,274 rooms spread across 11 states. That loan was securitized in a floating-rate single asset, single-borrower CMBS SASB transaction and replaced the original debt of $268 million at the time of payoff. Deutsche Bank Securities and BMO Capital Markets served as co-leads on the transaction.