KSL Capital Partners has secured acquisition financing for the Four Points by Sheraton Sydney, Central Park hotel through JLL Hotels and Hospitality Group and Debt Advisory.
The 297-key hotel is located in the Central Park mixed-used development in Sydney, close to universities, Chinatown, Surry Hills and public infrastructure.
The financing comprised senior and junior tranches backed by one international lender and an Australian-based credit provider; however, the financing sum was not disclosed.
KSL purchased the property in Q3 2021 and was sold subject to a management agreement with Marriott.
“We did see that traditional lenders were less aggressive on the transaction than would have likely been the case in pre-COVID times, but we had a good depth of debt capital seeking to be deployed into the opportunity,” Adam Bury, Executive Vice President, Investment Sales & Head of Hotel Debt Advisory, Australasia, JLL Hotels & Hospitality Group said.
“As the tourism sector sees continued recovery, we anticipate a recycling of capital in the hotel debt space with traditional lenders being replaced by overseas and non-bank debt providers.”
JLL’s Head of Debt Advisory Australasia, Matt Duncan said they saw significant demand from a range of domestic and foreign credit providers for this opportunity.
“Despite the challenging hotel trading conditions created by the COVID pandemic, with international and domestic state borders having been closed for extended periods and occupancy demands temporarily challenged,” Duncan said.
JLL Hotels and Hospitality group has transacted 94 assets across Australia and New Zealand with a total value of more than $1.6 billion over the past 12 months, whilst the Australasia debt advisory business has arranged over $1.7 billion of financing across all property sectors.
The hotel loan comes after developer GuavaLime secured a $29.3 million first mortgage construction facility from MaxCap Group to develop its Vibe Hotel Adelaide project in the South Australian capital.
Last month, developer KDL Property Group secured a $25 million land and construction loan for the Rosebank Estate residential project in Queensland from MaxCap Group.