INDIANAPOLIS—Sun Development & Management Corporation secured US$74 million in financing for five hotels.
The five properties, which represent more than 635 rooms, are:
• Hilton Garden Inn, Ridgefield Park, New Jersey;
• Embassy Suites, Palmdale, California;
• Homewood Suites, Nashville, Tennessee;
• Candlewood Suites, Hattiesburg, Mississippi; and
• Hampton Inn, Kissimmee, Florida.
“This is a good deal to make because we get five-year, short-term money at a decent rate,” Sun CEO Bharat Patel said during a telephone interview. The overall interest rate is more than 6%, he added.
The financing came from one of the “Big Three” New York banks, Patel said, though he declined to name which one. The Big Three commonly refers to JPMorgan Chase, Morgan Stanley and Merrill Lynch. Messages left with the three companies were not returned prior to deadline.
Patel said 60% of the debt comes in the form of first mortgage money. The interest rate on the first-mortgage debt is less than 5%.
Including the recently acquired financing, Sun has US$300 million of debt on its balance sheet at a weighted average interest rate of 6.5%.
Hotel performance
All the properties opened during 2009 and 2010. The hotels in the portfolio are “performing very well,” Patel said.
On a trailing 12-months basis, the hotel portfolio is running at 72% occupancy, with an average daily rate of US$127, and revenue per available room of US$90.
Sun’s hotel portfolio consists of 37 properties comprising more than 4,000 rooms.
Contact:
Sun Development & Management Corporation
Phone: 317-247-5500
Email: mail@sun-companies.com