PEG Cos. Buys Multi-State Marriott Portfolio
The roughly $130 million deal encompasses more than 1,000 guestrooms in eight states. Cantor Commercial Real Estate provided the acquisition financing.
By Scott Baltic
PEG Cos. has acquired an eight-hotel portfolio in major U.S. markets. The acquisition has a total value of about $130 million, Jameson Haslam, COO and a partner at PEG, told Commercial Property Executive.
PEG and PEG Capital Partners Fund III led a group of investors, with financing from Cantor Commercial Real Estate through brokers Academy Commercial and Berkadia, along with Ares Management managing funds.
The 1,052-key portfolio comprises one Courtyard by Marriott, in Charlotte, N.C., and seven Residence Inns by Marriott, in Sacramento, Calif., Santa Fe, N.M., St. Louis, Miss., Chicago, Boston, Tampa, Fla., and Mesa, Ariz.
“One of the compelling aspects of this investment is the myriad of exit strategies available with these properties,” PEG Chief Investment Officer Soren Halladay said in a prepared statement. “Our strong relationship with Marriott, coupled with our investment and development capabilities across multiple asset classes, allows us to be creative with not only the properties and their current uses but also further development opportunities within these specific markets.”
Meanwhile, Berkadia separately announced some of the details of its major role in the financing. Director Adrienne Kautzman of that company’s Phoenix office secured a $78 million acquisition bridge loan through Ares Commercial Real Estate Corp., for six of the hotels, totaling 828 rooms.
Fair winds for travel
Demand for hotel space looks to remain strong through the end of the year, based on a steady economy and healthy consumer confidence, according to a new third-quarter national hospitality report from Marcus & Millichap.
The largest hotel construction pipelines are geographically diverse, comprising (in order) New York, Dallas/Fort Worth, Los Angeles, Orlando, Nashville, Miami and Denver. Marriott led all hotel companies in room deliveries in the 12 months ending in June, at 32.5 percent of all rooms delivered, again per Marcus & Millichap.
Image courtesy of PEG Cos.