Skip to content

Search

Latest Stories

Peachtree secures $73 million financing for dual-branded San Diego hotel

Construction on the 16-story hotel starts this month, with a 22-month completion timeline

Peachtree secures $73 million financing for dual-branded San Diego hotel

PEACHTREE GROUP SECURED a $73 million construction loan and C-PACE financing to fund the development of a 263-key dual-brand Home2 Suites and Tru by Hilton Hotel in San Diego, California, on behalf of the locally based Baxter Hotel Group. Baxter is set to commence construction on its 16-story, dual-branded hotel this month, with a projected 22-month construction timeline, Peachtree said in a statement.

Peachtree facilitated a $50.4-million floating-rate construction loan with a three-year term and secured $22.6 million in fixed-rate C-PACE financing, amortized over 25 years. Collectively, these funds covered 64 percent of the total development cost, the statement said.


“We were able to execute an innovative capital stack with the addition of C-PACE in an otherwise challenging financing market, providing ample capital for the construction to begin while saving the sponsor 200 basis points in interest rate spread,” said Jared Schlosser, Peachtree’s senior vice president, head of hotel origination and C-PACE.

The budget includes C-PACE-eligible items like seismic improvements, lighting, building envelope, HVAC, plumbing, and qualifying soft costs, Peachtree added. The hotel targets both transient and extended-stay guests, addressing an historically underserved market.

The proposed amenities in this limited-service hotel depart from the norm and include sustainable designs for LEED certification, a ground-floor restaurant, and a rooftop pool with a fully equipped restaurant and bar offering panoramic views of Downtown San Diego, the company said.

In October, Peachtree Group's credit division concluded $556 million in loan originations, comprising half of the company's total deployment of $1.1 billion for the year. The remaining $526 million was allocated for the acquisition of five hotels and the initiation of three new hotel development projects. Sameer Nair was recently appointed as the senior vice president of equity asset management at Peachtree Group, responsible for overseeing asset management for Peachtree’s real estate portfolio and preferred equity investments.

More for you

U.S. Hotel Construction Drops to 40-Quarter Low: CoStar

CoStar: U.S. hotel construction hits 40-quarter low

Summary:

  • U.S. hotel rooms under construction fell year over year for the ninth month, CoStar reported.
  • About 137,956 rooms were under construction in September, down 12.3 percent from 2024.
  • In September, 12,746 midscale and 4,559 economy rooms were under construction.

U.S. HOTEL ROOMS under construction fell year over year for the ninth consecutive month in September, reaching the lowest level in 40 quarters, according to CoStar. Still, more rooms are under construction now than after the Great Recession.

Keep ReadingShow less