Gaylord Aurora 1,500-Room Hotel Project Finds Developer

By Gabriel Circiog, Associate Editor

The Gaylord Aurora convention hotel project, which was abandoned by the company that proposed it, has a new lease on life. Aurora officials told the Colorado Economic Development Commission that New York-based Area Property Partners will arrange financing for the $824 million project, while Houston-based Rida Development Corp. will develop the property.

The Denver Post reports that the key to getting the stalled project back on its feet was the fact that Marriott International will manage the 1,500-room hotel parallel with four existing Gaylord convention hotels. Rida Development Corp. and Area Property Partners are also currently developing a $350 million, 1,000-room hotel in Houston that will operate as a Marriott Marquis. Additionally, the two companies have partnered up on the 1,400-room Hilton Orlando—which they financed and built—and renovated the 1,200-room Hyatt Regency in New Orleans.

Area Property Partners intends to have the financing arranged by late summer, and Rida Development Corp. is in talks with contractors for the construction of what would be one of the largest convention hotels in the country, outside of Las Vegas. Construction is planned to start in late 2014 or early 2015, and the convention hotel is expected to open in 2017.

Located on land within the 1,800-acre High Point development, the project is expected to create around 1,200 construction jobs, with the hotel generating around 2,500 permanent positions.

One key element of the project is to keep the $81.4 million in credits against future state sales taxes, which the Colorado Economic Development Commission awarded Aurora under the Regional Tourism Act last May. Those incentives will be in addition to around $170 million in credits against future sales tax obligations, which Wendy Mitchell, president and CEO of the Aurora Economic Development Council, said the city is providing.

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Inland American Lodging Group Acquires 228-room Residence Inn Denver City Center for $80 Million

By Gabriel Circiog, Associate Editor

Inland American Lodging Group recently announced that it has acquired the 14-story Residence Inn by Marriott Denver City Center and the adjoining 448-space parking garage for a purchase price of $80 million. Located on Champa Street in downtown Denver, the Residence Inn Denver City Center is close to the 16th Street Mall and the Colorado Convention Center. The hotel features 228 guest rooms, 1,740 square feet of meeting space, a large lobby and a 448-space parking garage located within the building.

“We are very pleased to be adding this high-quality asset to our portfolio,” said Marcel Verbaas, president and CEO of Inland American Lodging Advisor Inc. “With its excellent location in the downtown Denver market, we believe the hotel is well positioned to continue its strong operational performance. This acquisition aligns perfectly with our strategic objective to grow our portfolio by adding well located upper-upscale and urban upscale hotels.”

Sage Hospitality will continue to manage the property and will also manage Inland American Lodging Group’s 275-room Napa Valley Marriott Hotel & Spa in Napa, Calif. “We look forward to working with Sage to continue to maximize profitability at the hotel and take full advantage of the positive dynamics in the Denver market,” said Verbaas.

Inland American Lodging Group Inc. is a wholly owned subsidiary of Inland American Real Estate Trust Inc., which focuses on acquiring and developing a varied portfolio of commercial real estate in the United States. As of year-end 2012 Inland American owned, directly or indirectly through joint ventures in which it has a controlling interest, 794 properties representing approximately 46 million square feet of retail, industrial and office properties; 5,311 conventional multifamily units; 5,212 student housing beds; and 16,345 lodging rooms.

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Photo Courtesy of: www.marriott.com

McWhinney Announces Fifth Multifamily Project in Colorado

By Gabriel Circiog, Associate Editor

McWhinney, a Colorado-based developer, has announced plans to start construction this month on a new multifamily project just north of Denver in Westminster, Colo. Dubbed as Arbour Commons, the development is the company’s fifth multifamily project. An official groundbreaking ceremony is scheduled for May.

Located off Interstate 25 and 144th Avenue at the Orchard Town Center master-planned community, Arbour Commons will be the second multifamily project developed by McWhinney at that location, situated just north of Arbour Square Apartments. The latter, a 300-unit multifamily development, opened in the fall of 2011.

McWhinney Vice President Chris LaPlante said: “The market has responded well to Arbour Square, and as vacancy rates continue to remain low, we look forward to responding and delivering on the market’s residential needs.”

Arbour Commons intends to deliver 394-units that will include studio, one-, two- and three-bedroom apartment homes. The units will feature numerous amenities equal to the existing McWhinney Lifestyle Communities along Colorado’s Front Range, which will include a nearly 8,000-square-foot state-of-the-art Welcome Center, 24-hour fitness facility, theatre and media room, conference and dining facilities, a sky lounge on the top floor, a resort-style swimming pool, and children’s play areas.

Located close to the Orchard Town Center—a 980,000-square-foot open-air retail and entertainment district, the residents of Arbour Commons will also have direct access to major highways such as I-25, Northwest Parkway and E-470.

Pre-leasing is expected to start in late summer. The first apartment homes are anticipated for move-in starting January 2014.

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Image Courtesy of: www.mcwhinney.com

HFF Arranges $233 Million in Financing for 1,523-unit Breakers Resort

By Gabriel Circiog, Associate Editor

Holliday Fenoglio Fowler recently announced that it has arranged $230 million in financing for The Breakers Resort in Denver. Working exclusively on behalf of The Bascom Group LLC, the borrower, the HFF team secured a $165 million first mortgage—a floating-rate loan that includes a three-year term with two one-year extension options provided through Bank of America and CIBC.

The HFF team also secured a $26.25 million mezzanine loan and $38.75 million of preferred equity provided by Prudential Real Estate Investors’ $805 million U.S. Real Estate Debt Fund. The proceeds were utilized to provide capital for future renovations to refinance existing mortgage and mezzanine loans that were secured for the ownership by HFF in 2011 and to buy out the existing institutional equity partner.

Located on 127 acres at 9099 East Mississippi Ave. close to Cherry Creek—a new community shopping center—and the Lowry Redevelopment, The Breakers Resort is a six-village, Class A multi-housing community that features 1,523 units. Developed by Koelbel and Company, which will retain an ownership interest, the property is 95 percent leased and features six interconnected communities surrounding a 55-acre recreational lake. Each community has its own clubhouse and a low density of 14 units per acre.

The project also includes a master clubhouse with a fitness center, business center, restaurant, community room and private theater. The property has 50 one- and two-bedroom floor plans averaging 1,019 square feet each. As part of the property, an 18.23-acre development parcel, which could include up to 628 units in the future, is considered by HFF one of the best remaining infill apartment sites in Denver.

HFF directors Charles Halladay and Mark Erland led the HFF team that represented Bascom and included Josh Simon, Jordan Robbins and Lee Redmond. “Bascom was able to access mezzanine and preferred equity capital available in today’s market and obtain financing on The Breakers Resort by adding an additional parcel of developable land as collateral, resulting in a blended cost of capital of less than 5 percent and a combined debt yield of 6.25 percent,” said Erland.

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Photo Courtesy of: www.thebreakersresort.com

Mountain Real Estate Capital Invests Over $100 Million in Oakwood Homes Partnership

By Gabriel Circiog, Associate Editor

Mountain Real Estate Capital, a Charlotte, N.C.-based residential real estate investment firm, recently announced it has entered into a strategic partnership with Colorado-based Oakwood Homes. The transaction, exceeding $100 million, will see Mountain Real Estate Capital provide Oakwood Homes strategic equity capital to accelerate its growth and expand into new markets. The Colorado homebuilding company plans to expand not only within Colorado but in other regions as well, including the Omaha market.

Peter Fioretti, chairman and CEO of Mountain Real Estate Capital, said: “Oakwood has clearly developed a competitive edge in their marketplace and continued to reinvent themselves with superior product and market positions during the downturn. Together, we will be positioned to now take advantage of the growing market opportunities throughout the Midwest and Western markets.”

Back in June 2012, Mountain Real Estate Group and Oakwood Homes jointly acquired the 2,600-acre, 8,500-lot master-planned community Banning Lewis Ranch in Colorado Springs. The acquisition led to close talks between the two parties, which in turn served as the foundation of this new partnership.

Pat Hamill, Oakwood’s founder, will continue as chairman, CEO and general partner of the venture. The partnership will initially include nine communities, a lot inventory of 7,100 home sites, a 348-backlog of sold homes, 200 homes under construction and a projection of over 600 units to be sold in 2013.

Hamill, talking about the new partnership, said: “This partnership not only delivers a capital infusion; it sets the stage for us to take advantage of market demand and expansion opportunities with greater flexibility than others in the industry.”

Logo Courtesy of: www.mountainfunding.com
Image Courtesy of: www.banninglewisranch.com

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