— Economic developments drive demand for hotel accommodations —
LOS ANGELES— iBorrow, a direct lender of private money loans for commercial real estate, has provided a $7 million loan to refinance a 73-room Holiday Inn Express and Suites located in Stockton, California. The borrower plans to utilize the funds to pay off existing loans, and upgrade the property.
Operating results at the Holiday Inn Express have improved over the past year, likely as a result of increased demand resulting from two large-scale projects that were recently completed nearby: a 1.4 million-square-foot state prison healthcare facility housing 3,000 inmates and employing 2,500 people, and a 431,000-square-foot Tesla manufacturing facility. The hotel also benefits from consistent business from the University of the Pacific in Stockton, which is close to the hotel.
“This is a high quality loan, as the property generates significant cash flow. Despite this, the loan was challenging because the borrower required a quick close and could not wait to obtain traditional financing,” said iBorrow CEO Brian Good. “There aren’t many comparable properties in the area so the valuation was a challenge. We had to step back and study the key economic drivers in the market which, when studied, showed an increased demand for hotel rooms. Of equal importance was the fact the borrower has a track record of strong hotel operating performance, which made us comfortable to provide financing for this project and borrower.”
The loan was originated by Will McCabe, Vice President of Loan Originations at iBorrow.