NEW YORK—J.P. Morgan has provided a non-recourse recapitalization of the 90-room 21c Museum Hotel in Louisville, Kentucky.
Sources declined to identify the specific value of the recapitalization but put the total investment at more than $30 million.
Debt has not been easy to find of late in secondary markets such as Louisville. But the hotel’s strong revenue-per-available-room penetration index performance helped attract the debt recapitalization, said John Bralower, president of Carlton Hospitality Group and managing director of parent company Carlton Group. Carlton acted as a third-party intermediary in assisting the hotel’s owners find a lender.
“Everyone wants to be in New York,” Bralower said. But, he added, “For good assets performing well, there’s a substantial amount of capital available.”
The 21c property is owned by Steve Wilson and his wife Laura Lee Brown.
J.P. Morgan officials could not be reached for comment by deadline.
Debt availability
Bralower said the lending market is opening up, somewhat. “A year ago, it was, ‘Can I get a deal done?’” he said. “Now it’s a matter of getting the best rate for your client.”
It’s still not easy finding funding for development deals, but he expects lending for development projects to be the next facet of the lending market to come back. The prices at which hotels are approaching in transactions might lend more credence to development loans, he said.
Bralower said CMBS also is showing signs of life, and there has been some balance-sheet lending. “Wish we’d see more of it,” he said of balance-sheet deals.
Overall, Bralower is optimistic about the state of the hotel sector. “But I do have a somewhat biased view sitting here in New York City,” he said.
Contact:
Carlton Group
Phone: 212-545-1000 (New York)
310-219-6900 (Los Angeles)
561-207-6250 (West Palm Beach, Florida)
312-629-4570 (Chicago)
44-(0)20-7976-5400 (London)