$230M in Financing Placed for Acquisition of 2 Westin Hotels

A two-part permanent financing package valued at an aggregate $230 million has been put in place for NCH-Transwest Corp.’s $310 million purchase of Tucson’s Westin La Paloma Resort & Spa, along with the Westin Hilton Head Island Resort in Hilton Head, S.C..Commercial mortgage banking firm Newmark Realty Capital Inc. orchestrated the financing, securing a $209 million first mortgage loan through JP Morgan Real Estate and a $21.5 million mezzanine loan from Ashford Hospitality Inc. News emerged in early December of last year that Tucson-based NCH-Transwest would acquire the upscale properties from an affiliate of lodging property managing firm Starwood Hotels & Resorts Worldwide. “The quality of the assets and the quality of the sponsorship were key,” Patrick Barkley, a principal with Newmark, told CPN today regarding obtaining the loans. Located on a 174-acre parcel, the Westin La Paloma features 487 guestrooms, as well as 27 holes of Jack Nicklaus Signature golf, 80,000 square feet of meeting space, restaurants and a spa. The property was developed in 1986 and commanded some $168 million in the sale. Westin Hilton Head sits on 14 acres along the ocean and encompasses over 40,000 square feet of meeting and event space, restaurants and a 7,500-square-foot spa. NCH-Transwest paid $142 million for the 23-year-old property.Given the timing of the acquisition, Newmark had its hands full, having to navigate the waters in a credit crunch environment. “It was about a 10-month process,” Barkley said. “We had one lender and we were about to close, but nine days before closing the market collapsed. Then there was a shallow pool of lenders to choose from, but once JP Morgan was on board, it was a smooth transaction, considering the market.”