Meridian Capital Group, America’s most active dealmaker, arranged $24 million in financing on behalf of Glenmont Capital Management, LLC for the acquisition and renovation of the Holiday Inn Express & Suites in Detroit, MI. Upon completion of a comprehensive renovation, the hotel will be rebranded as an upscale boutique Hotel Indigo.
The 36-month loan, provided by a balance sheet lender, features full-term interest only payments, a LIBOR-based floating rate, and two one-year extension options with a 30-year amortization schedule. Meridian Senior Managing Director, Tal Bar-Or, Senior Vice President, David Shapiro, and Vice President, Richard Sutton, who are all based in the company’s New York City headquarters, negotiated the financing for this transaction.
Located at 1020 Washington Boulevard in downtown Detroit, the 16-story, 241-key hotel contains 2,000 square feet of meeting space, a business center, fitness center, rooftop pool and 100 parking spots. Hotel Indigo is part of the InterContinental Hotel Group, which has a network of 96.4 million loyalty members. Renovating and repositioning the property into a superior brand within the IHG system will remove the rate ceiling associated with the budget-conscious Holiday Inn Express, attracting higher-rated business and allowing the hotel to capture a greater market share. Hotel Indigo currently has 79 properties open around the world, with an additional 68 in the pipeline. This hotel will be managed by Boston-based Pyramid Hotel Group.
“We are pleased to have advised Glenmont on the total capital stack for this project. The acquisition and redevelopment of the asset will bring a wonderful new hotel to the downtown Detroit CBD,” said Mr. Bar-Or. “The area is undergoing major investment by many forward thinkers and we believe this will continue to demonstrate the ability of skilled investors like Glenmont and operators like Pyramid to create value and enhance the neighborhood. Our ability to showcase the sponsorship, business plan, and deal metrics resulted in a competitive process for a heavy repositioning of this hospitality asset in a city that is still overlooked by most institutional investors and lenders.”
The property benefits from a strong street presence at the corner of Washington Boulevard and Michigan Avenue, conveniently situated among the CBD’s 16.8 million square feet of commercial office space. It is also in close proximity to redevelopment and adaptive reuse projects driving Detroit’s renaissance, including District Detroit, a $1.2 billion mixed-use development that will transform Detroit’s downtown into an enjoyable urban environment. In recent years, the area has seen tremendous growth, redevelopment, and gentrification, with new restaurants, parks, hotels, office buildings, and public transportation systems redefining life in the region.
Founded in 1991, Meridian Capital Group is America’s most active deal maker and one of the nation’s leading commercial real estate finance and investment sales firms. In 2017, Meridian closed over 3,000 transactions across more than 200 unique lenders and sold nearly $1 billion in commercial property. Since inception, the company has closed more than $300 billion in financing with the full complement of capital providers, encompassing local, regional and national banks, CMBS lenders, agency lenders, mortgage REITs, life insurance companies, credit unions and private equity funds. Meridian represents many of the world’s leading real estate investors and developers and the company’s expansive platform has specialized practices for a broad array of property types including office, retail, multifamily, hotel, mixed-use, industrial, healthcare, student housing and self-storage properties. Meridian is headquartered in New York City with offices in New Jersey, Maryland, Illinois, Ohio, Florida and California.