Knighthead Funding Provides $18.5 MM in Construction Financing on Denver and Savannah Developments
By: Knighthead Funding
The larger of the two financings is a $10 million non-recourse loan for the construction of The Condor, a 28-unit townhome development by First Stone Development in Denver's Berkeley neighborhood, four miles northwest of the city center. The property is located at 4469 Tennyson Street, the main arterial of the neighborhood's cultural district, with more than 50 specialty shops, boutiques, eateries, breweries and galleries. The three-level townhomes will range in size from 1,100 to 1,800 square feet and will include an attached single car garage and rooftop deck. This is the second loan Knighthead has funded for First Stone Development, the first, The Vaquita, also located in Denver, will begin sales later this year.
In July, Knighthead funded a $20 million loan for the construction of a 44-unit condominium development in Denver's nearby LoHi District.
"As Denver's economy and population continues to grow, neighborhoods with distinctive character close to downtown Denver, such as Berkeley and LoHi, are growing in popularity among those migrating to the area," said Knighthead Principal Jonathan Daniel.
In a separate financing, Knighthead funded an $8.5 million short-term loan for the completion of a 104-room Holiday Inn & Suites in the Savannah submarket of Pooler, GA.
The sponsor, a Georgia-based hotel development and management company whose assets include Hilton, Marriott and Holiday Inn flagged properties throughout the state of Georgia, used its own capital to fund the first half of the development. Due to liquidity constraints, the Sponsor needed a creative source of capital to get comfortable in funding a project that was approximately 50% completed.
"Judging by the quality of construction that had been completed, and the local experience of the sponsor who had already secured a 20-year franchise agreement from IHG, we were confident the hotel would perform well against the competitive set," said Knighthead Vice President Brian Sullivan who led the origination team on the loan. "Based on the occupancy and the average daily rate commanded by other hotels in the submarket, we believed the sponsor could meet its projected RevPar within the first 12 months of operation."
When completed in 2019 the Pooler Holiday Inn & Suites will feature 104 guest rooms, restaurant and lounge, outdoor pool with sundeck, fitness room, business center and market pantry.
About Knighthead Funding
Knighthead Funding, LLC http://www.knightheadfunding.com is a national real estate finance company specializing in loans for the acquisition, renovation, construction and refinancing of commercial real estate across all asset classes. Knighthead originates loans for its managed real estate debt funds and Knighthead Annuity & Life Assurance Company. Knighthead Funding is an affiliate of Knighthead Capital Management, LLC, a New York-based SEC registered investment management firm.
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